“Sydney house prices plummet 15%”
“House prices dropping and there’s no end in sight”
More realistic media headlines would insert the words ‘in some suburbs’ but that doesn’t grab the reader’s attention to the same degree!
The fact is that we are experiencing a changing market. Prices have fallen in some areas and continue to decline. But this is not the entire story. Any property buyers who are basing their purchasing decisions on a median property price for Sydney as a whole are using flawed data.
Sydney markets itself as a ‘city of villages’ and, when buying property, this is certainly true. These ‘villages’ need to be assessed on an individual basis and buyers will start to see a more realistic story of property prices in their suburb. House and unit prices do not change at the same rate or even in the same direction.
Take these four Eastern suburbs for example – Bellevue Hill, Paddington, Double Bay and Woollahra. Neighbouring suburbs with some similar housing stock, but each is distinctly different and buyers will usually have a preference between these suburbs.
Over the past 10 years median house prices have risen in all 4 suburbs and none have experienced a decline in the median price over the last year. But if we look at the rates of price increase Bellevue Hill has experienced the quickest and highest median price change.
Again, this is not the end of the story. Unit prices have behaved differently. Here we can see a decline since a 2017 peak. Does this mean don’t buy units in these suburbs? Not in my opinion.
These suburbs are a prime location. They are close to the city, close to beaches, have good schools, are close to medical facilities, and have all the local amenities that home owners want and require. They are well developed and with little space for new developments. These fundamentals do not change.
We can look at data for any suburb and we will see a different story. A good buyer’s agent will look at the data but, more than that, they will analyse the reason why prices are changing in that suburb and how this fits in with a buyer’s criteria.
Using media articles which amalgamate data for vast geographical areas in one headline-grabbing number will never lead you to the correct purchasing decision. The ‘City of Villages’ analogy is accurate and an in depth look at individual suburbs is required prior to any property purchasing decision is made.