Sydney homes on track for 20 per cent growth in 2014
Nick Lenaghan
537 words
17 Feb 2014
The Australian Financial Review
AFNR
English
Copyright 2014. Fairfax Media Management Pty Limited.
Sydney's eager buyers are paying up to secure homes before they get to auction.
Contracts were signed on a four-bedroom Cammeray house on Sydney's North Shore on Friday night, a week before it was due to go the block.
Recently built on a 503 square metre block, with a pool at the rear, 5 Alan Street sold for $3.39 million.
It was snapped up after three weeks on the market, 90 inspections, eight contracts issued and four parties showed interest.
"These people didn't want to wait for auction. They had a time frame and they just wanted to move quickly and do the business," said Jane Garwood from Belle Property Neutral Bay.
"The market is very strong. Cammeray was bit of an unrecognised pocket and now it has become sought after. There's very big demand, especially from young families."
What's true in Cammeray is also true for Sydney. The clearance rate nudged past 80 per cent over the weekend across 596 auctions on RP Data figures. Melbourne was more subdued, with clearances near 71 per cent from 785 auctions.
Nationally, there were 1650 auctions in the capital city markets, with a preliminary rate at almost 72 per cent – the highest since October last year.
Sydney house prices have gained 14.2 per cent in the past year. Melbourne had added 11.0 per cent.
SQM Research managing director Louis Christopher said Sydney's market had clearly made a strong start for the year. Clearance rates at this time were usually in the high 60 per cent range.
Mr Christopher is now even more comfortable with his forecast of late last year for Sydney homes to win another 15 per cent to 20 per cent in capital growth this year.
"We're feeling very confident that forecast is going to come in," he said.
"For clearances to start straight off in the late 70 per cent to low 80 per cent range implies there has been no softening in market conditions since we finished off last year.
"There is strong confidence from buyers out there that the capital gains are likely to continue well into this year. There is a sense of 'we'd better buy now before we miss out'."
Low interest rates, strong demand and historically low listings are driving the pace in the Sydney market.
"There is very little stock out there and plenty of buyers," Mr Christopher said. "That spells one thing: higher prices."
In Melbourne, buyer advocate Mal James is preparing for better things to come. Mr James's team calculated a 73 per cent clearance among the 26 $1 million-plus auctions they covered.
"In footy parlance, this weekend is a bit like the pre-season competition," Mr James said. "But things are charging back into the big time next week, with February 22 and the following week, March 1, both looking like being Super Saturdays."
One of the most expensive Melbourne homes to change hands was 9 Asling Street in Brighton. Set on a 1300 sq m block, the five-bedroom Victorian sold for $2.966 million, by RT Edgar.
(17-02-2014, 12:30 PM)specuvestor Wrote: So hot money is welcomed down under then... no worries mate until of course when the tide goes out
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