Ocean views, sought-after schools and hardly a property for sale in sight. Some of Sydney’s most tightly held suburbs had only a handful of sales within the past year.
The number of Sydney properties for sale plummeted amid the market downturn and economic uncertainty caused by rising interest rates, further reducing supply in areas with already low turnover – such as prime locations and smaller suburbs.
Waterfront Watsons Bay, Kirribilli and Whale Beach, where houses are in limited supply to begin with, were among more than 80 Sydney suburbs where five or fewer houses traded over the year to March, Domain data shows.
House sales were also limited in similarly small prestige suburbs like Point Piper, Darling Point and Tamarama, which each had between six and 12 transactions.
However, even areas with more housing, such as Bondi Beach, North Manly, Narrabeen and Brighton-le-sands, were among more than 370 Sydney suburbs where house sales slumped below 50, the benchmark used by Domain research to calculate a suburb’s median price.
As were middle ring suburbs like Summer Hill and North Epping, and outer suburbs like Mount Kuring-Gai and Camden.
For apartments, South Coogee, Clovelly, Millers Point, Enmore and Willoughby, were among the suburbs with limited sales.
It comes amid a drop in homes for sale, as sellers hesitate amid falling prices and rising interest rates. While prices have now been rebounding for several months, the number of homes listed for sale in May, was still down 20.7 per cent annually.
Ray White’s head of research Vanessa Rader said properties in prime locations, whether that was a waterfront or beach side position or a family-friendly suburb with good schools, were traditionally tightly held.
“These are typically pockets that have some kind of geographic advantage. You can’t just go recreate that too easily,” she said.
“If someone is selling an asset in these locations, where are they going to move to,” she said, adding this had become a greater concern amid low supply levels.
Rader said would-be sellers held back as prices declined. That then reduced the options for buyers, further deterring homeowners from selling, as they feared they would not find a suitable home to move to.
“It’s hard to find somewhere to buy, and if you have to go into the rental market, the vacancy rate is at a longtime low,” she said.
Uncertainty about the property market and broader economic outlook was also deterring sellers, as was the increasing difficulty of refinancing.
Eastern suburbs agent Ric Serrao, principal of Raine & Horne Double Bay, said traditionally tightly held suburbs had become even more so.
“There’s a percentage of clients who are opportunistic and when they feel the market prices are not on their side they just don’t list,” he said.
Limited supply increased competition for available properties, putting a floor under price declines, and supporting the recent rebound.
“How can something go down, when every time you’ve got a property you’ve got 10 to 15 people turning up,” Serrao said.
It was a similar story in the northern suburbs, where Pello Northern Suburbs principal Michael Dowling has seen listings become even fewer in low turnover suburbs like Denistone and East Ryde, which recorded 40 and 38 house sales, respectively.
“[East Ryde] is a very family orientated area, one of the areas in the Ryde district where all the neighbours seem to know each other … and there’s a lot of older people who have been there since the dress circle estate was built,” he said.
The area was popular with upgrading families from the north shore and inner west, seeking a comparatively more affordable house, in a family-friendly area and a central location.
Deciding to leave such a suburb behind is not easy, as East Ryde sellers Mark Khoo and Andrea Wong know, having recently listed their five-bedroom house to relocate closer to family.
They purchased one of the suburb’s original estate homes 18 years ago, from the property’s first owner, and later rebuilt on the block.
“East Ryde has been perfect for us raising a young family, it’s a very central location, close to schools, shopping centres and amenities, we’ve got lots of lovely neighbours, a strong sense of community and there’s lots of surrounding greenery,” he said.
“It was a difficult decision to decide to sell, but the market seems to be in a healthy state,” he said, adding there had been a strong level of interest so far.
“I think this reflects that it’s a sought after area with not much turnover.”
Dowling added that several months of price growth had given buyers and sellers more confidence to transact.
While listing volumes were still low, there had been a recent uptick in home appraisals across the northern suburbs, which could lead to an increase in homes for sale in three to four months time.
Source : TheSydneyMorningHerald