An increase in inner city apartment sales and steady growth in house prices should inspire a rise in consumer confidence in Sydney’s property market, according to Propell National Valuers.
The Sydney Residential Market September 2012 report issued by Propell National Valuers has forecast continuing economic growth and property prices showing more stability in 2012 - 2013.
Propell National Valuers’ NSW state manager Mark Nassif said first home buyers and seasoned investors would be attracted to the Sydney property market during this time.
“It’s obvious the government is trying to stimulate new homes being built by offering a generous saving on new houses and apartments,” Mr Nassif said.
“With expected drops in the cash rate and a change in government incentives, first home buyers will be encouraged to purchase apartments off the plan thanks to a new $15,000 incentive, rather than purchase existing properties without any stimulus benefits.
“Investors and buyers who had previously held out will also have an opportunity in the apartment market under $600,000 as there will be an influx of demand throughout October and the coming months.”
Recent RP Data statistics revealed an increase of 0.9 per cent in Sydney median house prices in the year to September 2012, one of the strongest results compared to the national average decline of -1.2 per cent.
According to RP Data, over the past year Sydney house values have increased by 0.8 per cent and unit values by 1.4 per cent.
While there has been a demand to live in units and apartments in the Sydney CBD with 1.4 per cent increase in unit values, the rental market in and around the CBD is currently undergoing moderation as people look for alternative options.
Mr Nassif said New South Wales’ growth had strengthened in 2012 despite continuing negative sentiment in the state, and this should impact positively on property prices in the next year.
“Data shows Sydney’s sales levels have been 23 per cent below last year’s level and falling since 2009, but transaction volumes are likely to rise in the next year,” he said.
“Lower interest rates should sustain the housing market as we experience lower Australian dollar exchange rates, slower growth in all sectors of the economy including mining, and a continuing government budget deficit.”