Sellers in prestigious Sydney areas are frantically discounting, leaving upgraders in a position to take advantage of Australia’s changing property landscape.
Savvy buyers could even end up with net savings of a whopping $250,000, or even more.
Sellers in Sydney are discounting houses by an average 7.5 per cent this week, and the average unit is currently being discounted by 7.2 per cent, the latest figures from property group CoreLogic reveal.
It’s bad news for sellers, but a tasty opportunity for upgraders, the founder of Buyers Domain, Nick Viner has said.
“I’ve been operating in Sydney’s markets since 2009 and in all that time, I don’t think conditions have ever favoured buyers as universally as they do now,” Viner said.
“There’s an incredibly rare window of opportunity to secure a really good quality property with extraordinary long-term potential because the competition just isn’t there at the moment.”
Pointing to the 7.35 per cent drop in the median Sydney dwelling value, Viner noted that the Eastern Suburbs have seen falls of up to 13.9 per cent in the year to July 2018, while the Northern Beaches have seen values soften 8.7 per cent.
He argued that thanks to the price cut, an upgrader who sells their home for $2.2 million to purchase a $4 million property will be $250,000 better-off than they would be if they had made the same manoeuvre last year.
“It is impossible to know when the market has hit the bottom until it is on the way back up and by then it is too late – it’s so much harder to secure your dream property in a rising market.”
Houses in Sydney are still worth a lot more than elsewhere
Despite the well-publicised slow-down, Sydney houses are still more than double the median value of an Adelaide or Hobart house.
“The reality is there has been very little improvement in housing affordability,” CoreLogic analyst Cameron Kusher said.
“Sydney and Melbourne in particular are a little cheaper than they were but remain substantially more expensive than other capital cities.”
However, he said the value gap between Sydney and Melbourne and their less expensive counterparts will shrink in coming months and years.
“While this may be the case, any significant reduction in housing costs back to historic premiums would take a long period of declines or flat housing market conditions,” he said.
“Furthermore, it seems unlikely, given the economic strength and populations of Sydney and Melbourne that the value premium of housing in these two cities will revert to historical levels.”
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