2017 Sydney Property Outlook
‘Bright future’ for Sydney property market in 2017″
The Sydney property market is in for another strong year of growth in 2017 on the back of low interest rates, robust investor demand and tight supply.
That’s the message from leading commentators at National Australia Bank, McGrath Estate Agents and QBE who are tipping house price growth across the harbour city to continue next year.
NAB, in particular, is bullish about the outlook for the Sydney market in 2017, forecasting price growth again to outpace other capital cities like Melbourne, Perth and Brisbane.
NAB chief economist, Alan Oster, says while house prices will likely lift 1.3 per cent nationwide in 2017, growth in Sydney is expected to be stronger.
He points to historically depressed interest rates, a pick up in lending to investors and a recent decline in sales volumes as key factors supporting rising prices.
“We have revised our price forecasts upwards in response to a sharp rise in the six-month annualised growth in dwelling prices, particularly in Sydney,” Oster says in NAB’s latest Quarterly Residential Property survey.
McGrath Estate Agents is also upbeat about the Sydney property outlook for 2017.
In its recently released 2017 McGrath Report, the agency highlights improved infrastructure, good schools and proximity to public transport as factors likely to see prices rise in many suburbs.
Another reason for continued strength, McGrath says, is supply, which remains tight in areas that showed some of the biggest price jumps in 2016, like Westmead and Fairlight.
McGrath’s report also points to robust appetite from investors, especially those from Asia, for Sydney property as another “key contributor” to 2017 price rises across the city.
“We see a bright future for the Sydney property market,” the report states.
“There is plenty of long term price growth ahead even as we approach a major affordability hurdle for younger buyers today.”
QBE’s outlook, meanwhile, is positive on the Sydney outlook but cautious about the national property picture.
Looking nationwide, QBE’s Housing Outlook 2016-19 says tighter investor lending will likely lead to a more subdued residential property market over the next three years.
In Sydney the news is better, with QBE saying a pick up in demand from owner occupiers should offset falling investor interest, keeping prices strong in the near term.
QBE tips Sydney’s median house price to lift 1.7 per cent in 2016-17 to $1,065,000.
The longer-term outlook for Sydney property is less secure, according to Australia’s largest insurer.
“New dwelling supply began to exceed demand in 2015-16, with Sydney’s underlying dwelling deficiency finally beginning to ease. Further expected falls in the deficiency through to 2018-19 is expected to continue to ease pressure on prices,” QBE says.
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