Overpriced Sydney Market

[WebBoard]

From: Louie Langov


With the current absurd prices people are paying for residential IPs with low yields, it reminds me of the recently overvalued stock market. Is anyone else out there thinking of a commercial with an upstairs residence?

 

[lawsjs]

Reply: 1
From: Jeremy Laws


Most prestige properties in Sydney are being sold to clever people with foreign funds. Sydney property is dirt cheap in comparison to overseas property of a similar type. In fact from a year ago it is 30% cheaper.Especially when US$ or UK stg is used. Hardly overpriced. London is absolutely absurd, studios in Richmond (not even on the tube) for example are currently _easily_ selling for $450k+ The rental return on these is a confortable 'net' 4% if you are lucky. Who is overpriced, or who is cheap?

 

[Robert]

Reply: 1.1
From: Robert Forward


When comparing Sydney to other Major cities around the world yes it is cheap. But cheap because of the Aussie dollar. Now if the Aussie dollar gets stronger then the purchasures intend on taking their cash back into foreign currencies then they are losing money aren't they cause their purchase is no longer what it was worth in $US or STG (UK pound).

And X-pats are not the ones keeping the Sydney prices over inflated. X-pats would only account for a very small minority of purchasures. And then you have to consider "are the X-pats/foreign investors only buying in Sydney. I doubt it.

Remember back in the hay days of the Gold Coast when Japanese were buying everything left right and center. Well now they are selling left right and center. A recent purchasure bought a restaurant from a Japanese investor that picked up the restaurant 2 years ago for $1.2m sold it a few weeks ago for $250k.....

So, I don't really see your point on this one Jeremy. Property is relative to the area not the whole world spectrum. Unless of cause you are talking about multi million dollar commercial property, but even at the rate it is still relative to the local market not the universal market.

Cheers
Robert