With October already creeping up, the year is ending in no time.
With this, you might be wondering how the property market in Sydney will be moving in 2020.
Will it be the right time to sell your Sydney property?
Or maybe it will be the right time to buy and invest?
We’ll be looking at what’s happened in the Sydney property market so far and opinions from a range of experts.
Sydney property market in 2019
The beginning of the year was definitely a dim one for Sydney with the property market cooling significantly.
However, in more recent months, there have been a number of developments that are suggesting the market is on the mend.
For instance, the results of the election and an increase in consumer sentiment.
The Australian Prudential Regulation Authority or APRA made a change to lending regulations, namely loosening the minimum interest rate serviceability buffer for banks.
On top of this, the Reserve Bank of Australia or RBA has cut interest rates to record lows.
The looser credit lending measures and lower interest rates have made borrowing easier.
Since June this year, Sydney’s overall dwelling values have been increasing.
Most recently in August, they went up by +1.6%.
However, dwelling values are still -13.3% below their last peak.
The rental market in Sydney is also weak compared to Australia’s other capital cities.
Rental yield is currently about 3.3% and rental rates have further decreased in August.
Sydney property market forecast 2020
In a recent report from Domain, it was predicted that we’re unlikely to see any more decreases in Sydney property prices.
Both houses and apartments are expected to grow during the end of 2019 and into 2020. Specifically, a +3-5% growth in the value of houses and a +2-4% growth in the value of units next year.
BIS Oxford Economics also predicts an increase in dwelling values next year.
However, it is believed that these increases will be capped as a result of the extra supply of dwellings.
BIS Oxford Economics expects house values in Sydney to increase by +6% and unit values by 1% in the next three years.
On the flip side, Sell or Hold and QBE don’t expect there to be much growth in 2020.
Though they don’t think prices will be falling much below their current value anymore, they also think that there will be little to no growth for overall dwelling values next year.
However, the QBE Australian Housing Outlook predicts that there will be a growth in rental yields and rental rates by June 2021.
Of course, nothing can be said for sure about what’s in store for Sydney’s property market in 2020.
However, it’s generally agreed that prices won’t fall much below what they are at now.
And most analysts agreed there should be at least 3-5% overall growth in Sydney.
However as always, Sydney will be a very fragmented property market and some areas are already outperforming strongly.
Guest author: Ellen Orton is the Head of Business Operations at OpenAgent.com.au, an online agent comparison website helping Australians to sell, buy and own property.