The month in review: Sydney
By Herron Todd White
June, 2010
Zetland, Rosebery and Waterloo
The types of property found in the inner city suburbs of Zetland, Rosebery and Waterloo are predominantly
comprised of modern medium-density unit development.
The purchaser demographic in these areas mainly consists
of young professionals and international investors, with
the appeal of such areas offering an attractive lifestyle
within close proximity to the city, airport and other
sought after amenities.
The type of buyer investing in property around Zetland,
Rosebery and Waterloo has remained consistent since
2008, dominated by young professionals and overseas
investors, particularly from Asia. It is likely that these
types of investors will remain the dominant buyer in
this market given the supply and demand factors for
this type of property. The main factor, which may impact
on this market in the near future, is that of the Chinese
economy. A slowing economy in China would likely see
Asian investors become less active and possibly reduce
property holdings in the market.
Bondi
The housing market of Bondi has experienced strong
growth during the past 12 months, particularly for
properties priced between $1 million and $2 million.
The buyer profile for Bondi predominantly consists of
established medium to high-income earners, particularly
families. In spite of the global credit crunch of 2008, the
buyer profile for Bondi has remained relatively constant
and is forecast to remain unchanged in the near future.
One particular trend worth noting in the Bondi housing
market is the purchasing of older, ‘rundown’ dwellings
with renovation potential. Thus, investors can take
advantage of a rising market and potentially make a
relatively significant profit in a short time frame.
Dee Why
The property market of the northern beaches suburb
of Dee Why has experienced significant growth in the
past 12 months, which has been largely contributed to
the first home-owners grant initiated by the Federal
Government. The type of property most prominent in the
Dee Why vicinity is predominantly medium density unit
developments. There has been exponential growth in
the construction of new unit complexes; with developers
seizing the opportunity to take advantage of the massive
potential the area has to offer.
The buyer profile in Dee Why mainly consists of younger
professionals and first homeowners, which has remained
relatively unchanged in recent years. They are attracted by
the area’s relative affordability, its proximity to beaches,
shops, public transport and other sought after amenities.
Despite the expectation that rising values in the area will
plateau due to interest rate rises, the buyer profile is not
expected to deviate too significantly in the near future.
Annandale
The suburb of Annandale in Sydney’s inner west has
experienced increased market activity in recent times, which hasn’t slowed despite recent increases to mortgage
interest rates. The suburb is characterised by mainly semidetached
and terrace style period dwellings which are
generally the most sought-after by purchasers, especially
the owner-occupier market.
Predominantly established purchasers upgrading
their place of residence are driving the strong market
conditions in this area. Buyers are generally professionals
and young families looking to secure their piece of real
estate in what is becoming one of the inner west region’s
most sought-after suburbs, thanks mainly to its proximity
to the CBD and abundance of period era homes.
The remaining dwellings in original condition are being
purchased at a premium price by buyers who are seeking
to capitalise on properties in need of renovations, however
there may be greater overall value for money in already
renovated properties due to less demand comparatively.
Westmead
The suburb of Westmead in Sydney’s west has experienced
increased market activity in recent times, which hasn’t
slowed despite recent increases to mortgage interest
rates. The suburb is characterised by mainly freestanding
dwellings and medium density development, comprising
of mainly units with townhouse and duplex development.
Freestanding dwellings are generally the most soughtafter
by the owner-occupier market, whilst the medium
density properties of predominantly units are investors
and owner-occupier driven.
The strong market conditions in this area for freestanding
dwellings are being driven by predominantly established
purchasers upgrading their place of residence. Buyers are
generally professionals and young families looking to
secure their piece of real estate in what is becoming one
of the region’s most sought-after suburbs, thanks mainly
to the suburb’s proximity to the Parramatta CBD, good
public transport and easy access to the M4 Motorway,
which then provides easy access to the Sydney Metro
area.
The remaining dwellings in original condition are being
purchased at a premium price by buyers who are seeking
to capitalise on properties in need of renovations or to
rebuild, however there may be greater overall value
for money in already renovated properties due to less
demand comparatively.
There has always been a constant level of activity in the
medium density market of Westmead, with unit buildings
ranging in age from the 1960s-built to recently-built unit
complexes. Unit developments that have been built
within the past two years and nearing completion have
been well received in the market place and have benefited
from increased market values for the past 16 months, as
well as satisfactory rental returns.
Despite the expectation that rising values in the area will
plateau due to eventual effect of interest rate rises, the
buyer profile is not expected to deviate too significantly
in the near future.
Blackheath
The town of Blackheath in the upper Blue Mountains has
seen increased market activity in the past six months, due
largely to the fact that the town caters to a wide range
of buyers. The town is typically characterised by older,
character style dwellings interspersed with pockets of
1980s and 1990s brick veneer dwellings.
The older style dwellings, which are usually on welllandscaped
and manicured allotments typically, attract
two types of purchasers. The first comprises investors
from Sydney looking to purchase on idyllic mountains
cottage, to be utilised jointly as a weekender style
holiday location, as well as short team leasing to other
people looking to use it for the same thing. This way they
are receiving some return on their investment as well as
having a weekend and school holiday getaway.
The second type of buyer attracted to this style of dwelling
is the retired couple and tree changers. Blackheath
provides a sleepy mountain lifestyle whilst still providing
most necessary amenities as well as a golf course, railway
station and loads of nearby bushwalking tracks.
The newer style brick veneer dwellings provide affordable
options for local first home-buyers or families looking to
purchase their second home. Blackheath is serviced by a
primary school. The nearest secondary school is situated
approximately 10 minutes drive to the east at Katoomba.
Blackheath, as is the case with most upper mountain
villages, can tend to be quite cyclical, however after an
extended period of inactivity it could be expected that
this trend may continue into the second half of this year
subject to interest rate rises and the looming Federal
Election.
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