What Drives Higher Property Prices In Sydney’s Inner City?
With Alexandria’s record house price being smashed by a recent sale over $3m, everyone’s talking about what contributed to the high price for the off-the-plan two-storey apartment.
Let’s take a look at what drives higher prices in Sydney’s inner city and if we can expect more suburb records in the coming months.
What contributed to the Alexandria suburb record?
The Park Terrace apartment that set the new suburb record is just one of about 400 apartments planned for HPG Australia’s $700m One Sydney Park development, set to be completed by 2021. At $3.12m, the sale is well and truly over Alexandria’s median house price of $1.73m.
The apartment was sold to a Castle Hill couple downsizing from a five-bedroom home, indicating that the development’s luxury features (such as a two-storey wellness complex, dedicated “Zen gardens” and Sydney Park views) attracted buyers that are happy to pay more for a property that contributes to a high quality of life. This is a good sign for vendors with similar features in their buildings, or those considering adding premium features in a renovation.
Luxury properties in the inner city
The luxury apartments of One Sydney Park are a continuation of sales we’ve seen in the inner city in recent years, where properties that offer something a bit special are bound to command a higher price. Given Alexandria’s industrial history, this has often come in the form of sophisticated warehouse conversions, whereas in Erskineville, it might be older terraces with quality renovations, personality, or proximity to the village centre.
Those looking for something more modest will find that standalone houses are where higher prices are found in the inner city, as they only account for 3.4% of Alexandria’s properties. This puts features like yard space at a premium, which is likely to increase prices for these of properties as new developments bring more new units without these assets to the inner city.
Lifestyle and location in the inner city
But while luxury developments and larger properties themselves cause an obvious push to prices, Alexandria’s increasing draw as a hub of lifestyle and convenience has caused a boom in prices across the board in recent years. The previously industrial suburb teems with some of Sydney’s most popular cafes, clothing outlets and furniture stores, while close proximity to the dining and entertainment options in Erskineville, Redfern and Newtown can also be an advantage for sellers.
Giving the One Sydney Park development its name, the expansive Sydney Park is a busy spot on weekends, with sports fields, barbecues, kids’ play areas and off-leash dog areas. The area’s green spaces are popular with buyers, so properties close to the park might also see a higher final sale price.
Alexandria transport and schools
While there’s no train station in Alexandria, it’s a short walk to one in nearby suburbs like Redfern, Green Square, St Peters and Erskineville, depending on your location. There are also buses into the CBD, a direct bike path and plans for a metro stop at Waterloo, so there’s no shortage of convenient options that suit potential buyers.
New schools being built in the area, such as the Alexandria “super school”, will also be a key selling point for those with families.
Will the new suburb price record be repeated?
Despite the features and location that attract buyers happy to pay more, a sale price this high is still an anomaly in the inner city. Luxury or unique properties may still see higher than average prices, but it’s unlikely to be typical of the majority of inner city property sales.
