Market Snapshot
Sydney’s property market is showing signs of stabilisation, even as it weathers a cooling phase after its August 2024 peak. The CoreLogic Home Value Index for November reveals a market with softened demand but enduring value, offering opportunities for strategic buyers. In November 2024, Sydney’s dwelling values declined by 0.2%, bringing the quarterly drop to 0.5%. The annual growth rate of 3.3%, coupled with a median dwelling value of $1,196,809, underscores Sydney’s reputation as Australia’s premier real estate market, despite the cooling trend.
Houses have experienced a sharper correction, with values declining 0.8% over the quarter, compared to a 0.4% rise for units. This divergence points to increased interest in apartments, driven by affordability pressures and changing buyer demographics.
Sales & Listings
Sales volumes in Sydney are down significantly, with activity 15.4% lower than a year ago and 15.1% below the five-year average. Meanwhile, listings have risen 10.4% above the five-year average, providing buyers with a wider array of choices but exerting downward pressure on selling prices.
Rental Market Conditions
Rental yields in Sydney remain subdued at 3.0%, reflecting the premium pricing of the market. Annual rental growth has slowed to 5.3%, the smallest increase since 2021. Rising rental listings suggest a gradual rebalancing of supply and demand, which could further moderate rental price growth.
Economic & Supply Dynamics
- Interest Rate Environment: The persistence of high core inflation and tight labour markets has tempered expectations for near-term rate cuts. This continues to challenge affordability and buyer sentiment.
- Housing Supply Issues: A sluggish construction sector, hampered by elevated costs and labour shortages, has limited new supply, exacerbating Sydney’s structural housing shortage.
Opportunities For Buyers
For discerning buyers, current conditions present opportunities to secure value, particularly in the unit market and high-end property segments. The broader slowdown in the market may provide negotiating power, especially for well-informed buyers leveraging the current rise in stock levels.
Sydney’s property market in December 2024 embodies a period of adjustment, marked by softened demand and strategic opportunities. As Australia’s leading buyer’s agent, Rose and Jones is committed to guiding clients through these complexities, ensuring they make informed decisions in one of the world’s most dynamic real estate market.
Source: CoreLogic Hedonic Home Value Index, December 2024
