The property experts have come out in full force with predictions about what to expect for the inner city property market in 2020.
New government schemes will entice first home buyers, the downsizing market will grow and new infrastructure will make Sydney’s inner city more attractive for a diversity of buyers.
Sydney’s property experts have had their say
The general consensus is that despite a poor first half of 2019, the Sydney property market enjoyed a positive swing in the last quarter of the year.
Things really warmed up from Spring and, over the September quarter, ABS reported a 2.4% increase in residential property prices across the combined capital cities and CoreLogic reported a 2.2% increase. The last week of 2019 saw auction clearance rates in the Inner West hit 88.2% and in the City and Inner South they hit 93.2%.
This momentum is expected to continue through the start of 2020, with hopes the trend will continue for the next 12 months and beyond.
Leading economists say a combination of factors are influencing a potential turnaround in the inner city property market. Both an improvement in consumer sentiment and consecutive interest rate drops from the RBA mean the market has every chance of seeing some level of growth in 2020.
Trent Wiltshire from Domain says that with people able to borrow more, Sydney properties should expect to see “subdued growth” in 2020. Experts contributing to the QBE Australian Housing Outlook agree with Wiltshire’s conservative approach, saying while only “little change” can be expected for 2020, a ramp-up will reach its crescendo by mid-2021.
We tend to agree: the green shoots we’ve seen in the second half of 2019 look to be set to continue into the start of 2020, and we expect to see the year begin well for buyers and sellers. In fact, those who bought during the downturn could even see some growth in 2020.
The ‘Sydney downsizers’ demographic will continue to grow
Sydney’s downsizing demographic continues to increase year-on-year, and their unique list of ‘must-includes’ means they will be on the prowl for the ideal new home in the inner city.
We’ve already witnessed this demographic grow in our area over the past years, and expect the positive sentiment in 2020 to continue to boost interest from downsizers in the inner city.
Top of many downsizer’s list is a smaller, low maintenance property with convenience and lifestyle appeal. This makes Sydney’s inner suburbs the ideal hunting ground. Likewise, level access to their home, as well as proximity to public transport and essential amenities will drive this rapidly expanding group of home buyers to the inner city in 2020.
First home buyers will take advantage of government grants
Having gone into hiding throughout the recent boom period, first home buyers will soon be back in force, and in particular you can expect to see their interest in inner city units.
Record lows for interest rates are part of the story. But it’s not just access to more agreeable home loans that will see them out hunting for property in 2020.
More importantly, a series of government grants and initiatives are in place to give new buyers a chance to get on the property ladder. Most notable is the First Home Owner Grant, with eligible NSW buyers receiving $10,000 towards the purchase of their new home – in addition to help from the First Home Buyer Assistance Scheme, and the First Home Super Saver Scheme.
And from 2020, first home buyers will have the opportunity for even more help in the form of the First Home Loan Deposit Scheme. Kicking off from 1 January 2020, the initiative will assist buyers to purchase a home with as little as 5% deposit. This helps them enormously in jumping the biggest hurdle for any buyer: saving the deposit.
New infrastructure will make the inner city property market more attractive
Improvements to Sydney’s inner city infrastructure will also have an influence on how the property market plays out in 2020. Several upgrades and projects are set to make the area even more desirable.
Families looking to move to the inner suburbs will be able to enrol their children in classes at the new Inner Sydney High School from 2020, while the Central to Eveleigh Urban Transformation Strategy is set to bring exciting new changes to the area and its surrounds.
Elsewhere, the continued development of WestConnex will better link Sydney’s outer suburbs with the inner city. And Waterloo has been awarded nearly $300 million by the state government to build a new metro station and integrated development around it.
Ready to take your next property step in 2020?
If you’re keen to take advantage of all these factors influencing the Sydney property market, get in touch with me today.