End Of Year Market Wrap

December 15th, 2023 - by Brad Gillespie

2023 has been an excellent year for price growth in our area, and we’ve seen property in high demand from buyers.

We take a look at where the property market sits in December 2023 for Sydney’s inner city and inner west.

The current state of play

2023 has been a good year for the property market around the country.

Since hitting the bottom of its trough in January this year, CoreLogic’s National Home Values Index increased by 8.3%, reaching a new record high in December 2023.

Sydney’s median home value performed even better, rising 11.3% over the year-to-date to hit $1,125,533. However, there are signs this growth may be slowing a little, with a rise of 1.8% over the last quarter and just 0.3% over November.

In our area, the combined suburbs of Marrickville, Sydenham and Petersham saw dwelling values increase by 15.6% to reach a median of $1,590,316, placing our area second nationally on Corelogic’s list of capital city areas with the highest 12-month value growth.

As we entered December, the auction clearance rate was a healthy 61.8% in Sydney’s city and inner south and 71.2% in the inner west.

Prices have increased

Despite rising interest rates and concerns about cost of living creating a challenging buying environment, we’ve seen price increases in most local suburbs.

This has been the result of several factors, including a wider trend for price growth that’s seen some suburbs double in price over the last decade. We’ve also experienced low listing levels and a shortage of new developments, which has put pressure on the supply side of the equation.

Here’s a snapshot of current medians in our area.

Suburb Median House Value % Increase Over 12 Months Median Apartment Value % Increase Over 12 Months
Erskineville $1,800,000 11.1% $975,000 4.8%
Alexandria $1,962,500 9.0% $887,500 4.4%
Waterloo $1,470,000 3.9% $890,000 -1.9%
Beaconsfield $1,948,000 35.3% n/a n/a
Newtown $1,757,500 4.3% $705,000 -4.5%
Chippendale $1,675,500 4.7% $760,000 -2.6%
Camperdown $1,811,000 9.8% $900,000 3.4%
Redfern $1,652,000 0.7% $1,000,000 3.8%

(source: realestate.com.au suburb profiles accessed 7/12/23)

Buyer demand still rising

Rising prices are in part due to the strong buyer demand in our area across 2023.

PropTrack data reveals buyer demand for houses in Alexandria was up 38% year-on-year, and demand for apartments increased by 8%. In Erskineville, demand for houses was up 4%, and apartments 16%, while houses in Newtown experienced an increase in buyer demand of 19% and apartments 30%.

We’ve continued to see strong interest in our area in a wide range of demographics, including from downsizers, professionals, young families, and first home buyers.

In 2023, the NSW Government expanded the First Home Buyer Assistance Scheme (FHBAS). In doing so, it lifted the transfer duty exemption threshold for new and existing home purchases by eligible first home buyers from $650,000 to $800,000, and the concessional rate from $800,000 to $1 million.

This provides first-home buyers with more realistic price caps for the Sydney market.

There could also be further good news for first-time buyers in 2024 if the federal government’s Help to Buy Scheme gets off the ground.

Rental squeeze

Rents continued to rise this year and, while this is good news for investors (and helps balance rising interest rates), it has created a challenging environment for tenants.

The citywide median rent is now $819 per week - up from $696 a week exactly one year ago. That’s $123, or 17.7% higher than this time last year, according to SQM Research.

In Alexandria, the vacancy rate is just 0.9%. The low level of available properties has helped push rents up 17.1% for houses and 16.7% for apartments, with apartments renting in 17 days.

Next door in Erskineville the vacancy rate is just 1.83%, and rents on houses are up 6.9% and apartments by 15.4%, with apartments renting in just 15 days.

This has led some tenants to consider whether this could be a good time to end renting and buy a home, even in the face of rising sales prices and interest rates..

2023 Highlights

One of our real highlights this year was breaking the Newtown suburb record for the second time with the same property.

We co-listed 198-200 Australia Street, Newtown, with Ben Collier of The Agency, and it sold for $13.5 million in October, showing the strength of the prestige market and the popularity of Newtown with an ever-expanding range of buyers.

We also ended the year on a high with the sale of a designer four-bedroom house at 130 Belmont Street, Alexandria. We had huge interest in this property with 157 inspections and 12 registered bidders at the auction.

Personally, I was also proud to be included in The Daily Telegraph’s list of the top ranked real estate agents in Sydney’s inner west and inner city.

Using realestate.com.au data, the Telegraph called out our high sales volume (82) over the past year, which they attributed to our cutting edge marketing tactics and the power of online technology.

We believe our team’s longevity in the market - over 25 years - has put us in a great place, giving us experience through different market conditions, and helping us build one of Sydney’s largest databases of buyers.

The view ahead

The Big Four banks believe next year will be another strong one for the property market. Both CBA and ANZ forecast a 4% rise in Sydney’s median home value, while NAB forecasts 5% and Westpac 6%.

We have a wide range of properties on the market from amazing one bedroom apartments to character terrace houses and family homes, and would love to help you with your next property move in 2024.

Wishing you and your family all the best for the festive season. We look forward to seeing you in the New Year.