The last year has been the worst economic period in Australia’s modern history. Investors and homebuyers have felt uncertain about buying real estate in Sydney. International borders remain closed, students aren’t allowed into the country, and local governments continue to enforce local lockdowns as new COVID-19 variants emerge.
Sydney is one of the world’s most excellent real estate markets. The real estate market has grown 400% in the previous 30 years, and property valuations continue to rise in the last 12 months.
Although Sydney’s real estate market witnessed incredible uncertainty in 2020, the real estate market has grown at record rates in the previous year.
Recent Price Movements for Houses and Apartments
Sydney’s house prices grew by an impressive 8.2 per cent in 2021’s second quarter. Why? That’s because of the increasing demand for houses and family-sized apartments in Sydney’s middle ring and inner suburbs. House prices have rocketed thanks to Australia’s economy recovering from the COVID-19 pandemic shock in 2020.
As a result, the Sydney housing market has grown far faster than most economists predicted in the past 12 months. Dwelling values soared by an impressive 10.6 per cent over the last 12 months, proving Australia’s robust recovery in previous months.
Furthermore, house prices hit record highs in June 2021. Homeowners were selling their homes for an impressive $1.2 million in June. Also, house prices have grown by $1266 every day in the previous 12 months.
Interest rates have remained low in recent times, which has been very attractive to homebuyers and investors. That has caused house and apartment prices to increase in Sydney. Homeowners were also afraid to sell their homes during the pandemic because of uncertainty.
In turn, there were fewer houses on the market, and sellers saw increased values due to a lack of competition on the market.
Forecast Price Movements for Houses and Apartments
Many Australians believed the country was over the worst of the pandemic. However, the delta variant has forced many Australian cities, including Sydney, back into lockdown. Some economists do believe that Australia’s house prices will continue growing, but other economists expect a downtown in values at the end of 2021.
However, many experts maintain their predictions on the 2021 Sydney real estate market. For example, ANZ predicted a 19 per cent rise in Sydney house prices in 2021. They also predicted national real estate prices to increase by 15.1 per cent.
That said, the bank does expect things to slow down towards the end of the year. Sydney house prices are up by 15 per cent since the start of 2021, but increasing COVID restrictions create uncertainty.
However, Sydney’s real estate values should increase by double-digits in 2021 despite ongoing economic and societal issues. High-rise apartments will likely stagnate, but family-sized apartments and houses should continue to flourish.
Sydney’s house prices will remain strong no matter what happens in the coming months. Almost all economics predict double-digit growth through 2021, maintaining the impressive growth of recent months, albeit slightly slower.