Inner Sydney market 2011

[InnerWestie]

On a micro level, inner Sydney is looking pretty good at the moment IMO.

Attended several auctions over the last couple of weekends and at each there was a very satisfied vendor at the conclusion.

For all the D&G, open inspections seem heavily attended, and people seem rather enthused about property in Inner Sydney at the moment.

Funnily enough, a few years back while many other parts of Australia were screaming about huge CG most in Sydney (myself included) were not so excited, after all CG over the last 7 years in Sydney has been rather disappointing.

Could it be that Sydney is about to have a decent run? I am not necessarily tipping huge CG but something in the vicinity of 5-8% for well located Sydney property in the sub $1m price bracket would not surprise me this year.

Anyone else feeling the same way or are people seeing something different out there in the field?

 

[JustRent]

Looking at things from a slightly different angle;

The rental market in the inner west is extremely tight. As tight as i can remember it being in the last 10 years. In theory this alone should keep sales prices ticking along.

 

[Propertunity]

I am not necessarily tipping huge CG but something in the vicinity of 5-8% for well located Sydney property in the sub $1m price bracket would not surprise me this year.

Anyone else feeling the same way or are people seeing something different out there in the field?

I am tipping about the same as yourself. I have been banging on about the Inner West for nearly 2 years now and it is showing no signs of slowing down from what I am observing.

Interestingly enough, the CG 'boom' in Sydney has been in some very narrow bands like the Inner West and a few other places, but this has not been replicated city-wide.

 

[traveller]

Well i can share my experience(and not in Inner West):

Bought in May 2009 few townhouses for 265K. Recent Bank valuation came at 350k each(Dec 2010). Location Quakers Hill...32% in 18 months...

 

[InnerWestie]

Looking at things from a slightly different angle;

The rental market in the inner west is extremely tight. As tight as i can remember it being in the last 10 years. In theory this alone should keep sales prices ticking along.

Absolutely, the rental market in the Inner West is quite astounding but then again it isn't much a surprise given the relative value of this area.

The vacancy rate for affordably priced apartments in the Inner East is also incredibly strong. I have 2, 2 bedders in the area priced at around $700pw range that were tenanted almost instantly after one inspection in October/November last year, one for asking price, one with a $35 pw increased offer. A handful of applications on both.

Maybe in the top-end luxury market of this area it may be more difficult but I am not interested in that part of the market (from an investment point of view anyway).

 

[Jacque]

Well i can share my experience(and not in Inner West):

Bought in May 2009 few townhouses for 265K. Recent Bank valuation came at 350k each(Dec 2010). Location Quakers Hill...32% in 18 months...

Well done there Traveller. Nice result for an area that I've bought for several clients in now. Good value, close to rail, low maintenance properties that are achieving good rents. The good old western suburbs may get overlooked at times due to all the hype generated about other areas but their cg continues to match (or outperform, in some cases) other suburbs closer in to the cbd, and they are still affordable for many first time investors who can't afford the higher entry and holding costs of more pricier property.

Affordability is always going to a be a large determinant of growth in certain suburbs, as is evidenced by the recent fallout from some of Sydney's more expensive and exclusive enclaves post GFC. Take Mosman houses, for example- last year their cg for the 12 mths in housing was a miserable 0.6% whilst Quakers Hills houses enjoyed 9.2% cg for the same period (Source PDS)

 

[Insight1234]

Interesting having been invested in a 2 bedder in Rozelle for 10 years I'm expecting a signficant rent jump when my tenant leaves at end of March, already have people asking to get to it first and we haven't even advertised it yet.

Probably one thing to note however is inner west (Rozelle particularly) went through a unit building boom from very late 1990's into mid 2000's so CG and rental yield wasn't as good as elsewhere at the time. That said with little to no signficant building since and the expansion of the Balmain living effect, its been upwards all the way.

So far I'm confidently expecting a 10-15% jump up in rent from March, one prospective tenant (may not be the right one for us) has indicated they'd contemplate paying 25% more than our outgoing tenant.