The PROPERTY DOCTORS, Sydney Australia Novak Properties
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The PROPERTY DOCTORS, Sydney Australia Novak Properties
NOVAK NEWS - HAS SYDNEY HAD ITS RUN? WHERE ARE BUYERS TURNING NEXT?
Sydney's property market has reached a pivotal moment. After years of relentless growth pushing prices into the stratosphere, we're witnessing signs of a plateau that's prompting investors and homebuyers alike to look beyond Australia's harbor city.
The data tells a fascinating story of shifting momentum across Australia's capital cities. National growth forecasts remain positive with houses expected to rise 3.3% in 2025 and 6% in 2026, while units could perform even stronger at 4.6% and 5.5% respectively. Perth currently leads growth projections at 4% for 2025, with Canberra and Melbourne following at 3.5%, slightly ahead of Sydney's 3.3%. However, Sydney isn't surrendering its crown without a fight—2026 forecasts show it surging to 7.8% growth, outpacing Melbourne's 6%.
What's most revealing is how dramatically market performance varies even within metropolitan areas. The Northern Beaches rental market remains fiercely competitive while areas just 40km away show abundant availability. Infrastructure development creates localized booms—Castle Hill property values jumped 76% following metro line construction compared to neighboring Baulkham Hills' 37% growth during the same period. These micro-markets make broad generalizations dangerous for investors.
The smart money focuses on long-term strategies, personal circumstances, and hyper-local knowledge. Young couples might still prioritize lifestyle and proximity to Sydney's CBD, while growing families could find better value heading west. What matters is understanding whether you're seeking a forever home or investment vehicle, and whether rental yield or capital appreciation better serves your goals.
Despite affordability challenges, Sydney's fundamentals remain strong for those taking a 10-year view. Recent zoning changes have created new opportunities even as other capitals gain attention. The question isn't whether Sydney has had its run—it's whether you have the patience to benefit from its next cycle of growth.
All right, here we are. Novak News on Monday Bidan and Billy. We're talking about Sydney. Has Sydney had its run? Where are buyers turning next? Stay tuned and find out more.
Speaker 2:Good evening Bids. Hello, how are you today? Very good, how are you? Yeah, I've been busy, eh it's been a busy day, very busy day, a big day. Actually. Started off looking at new properties, then finished off really just cooling through the weekend.
Speaker 2:And here we are, novak News talking about Sydney versus really all the other states yeah, basically and capital cities. It's a little bit like a state of origin. I feel like this conversation it's controversial because I think for a while Sydney's had a really, really good run and now it seems like it's plateaued a little. I would say yeah, some say plateaued, some would also say reached a point where affordability is on everyone's mind and people, let's face it. Turning to other states and other capital cities looking for opportunity, that's what we're going to unpack tonight.
Speaker 1:Definitely so. I think pretty much everyone has been noticing it throughout the time. Property market has gone quite up, and with the pricing going up, so is the mortgage and so is the rentals. I think everyone has been experiencing it firsthand like even from shopping centres to running their business, from family and friends. So what is actually happening? So does this keep? Going up or does this stay firm?
Speaker 2:now. Well, the outlook for 2025 and 2026, it is positive. It is price growth across the board. National growth trends houses forecasted to rise 3.3% in 2025 and 6% in 2026. Units a little bit more 4.6% in 2025 and 5.5% in 2026. Look, there is a demand for affordable price points and that's nationwide Very much.
Speaker 1:I think that's why we're seeing more people, like when we're doing open homes, we're seeing more people in apartments. Because the housing price has gone so high up, people are coming to look what they can afford, which are apartments, so we're seeing a bit of surge there in open home numbers and people who are not being able to go to the suburb they like they're going to the next suburb, so I think, which kind of impacts the price in the whole surrounding. Uh, I think we have this uh good terminology called the brights made suburb. So if you call manly as the bride, which is very hard to touch, right, right, already taken it's, it's at the entry point is very tough. We go to manlyvale or we go to balgola, which is kind of the neighboring, neighboring suburb, so uh, people are kind of getting creative in that way.
Speaker 2:I would say, and therefore we may be seeing that not just with suburbs but with cities and then states. It has a knock-on effect and you do tend to find we were speaking about this off-air as a team you do tend to find that your blue-chip locations, when they go up 10%, it's very, very rare you find the neighboring suburb or the five kilometer, ten kilometer radius around it has no movement. Quite often it follows trend. So I do think the growth you'll find over the next 12, 24 months will be in the latter half of the year. As rate rates come down again. It's going to add more fuel with borrowing capacity and lending into the market and then we've got to go over an election which is coming into may.
Speaker 1:Yeah, I think that has created a bit of uncertainty in the market as well. With the election coming through. Uh, you know, do we still still buy? Do we, you know, wait for a while to get get it, get it about stable before jumping to something? Because I think it's a commitment for everyone like getting into a new business or getting into your first home or your second home. So I think that with that uncertainty, everyone we can kind of feel that on the market like people are not jumping quite straight away. Yeah, yeah.
Speaker 2:Now the question we're going to answer tonight has Sydney had its run and where are buyers turning to next? If you don't mind, can you bring up the data? We try to look at this data as much as we can so we give you an unbiased opinion. This is really interesting. Like you've got houses and units divided, you've got 2025 and 2026. And what you're looking at there is the forecasted growth. Now KPMG did a really good report, obviously one of Australia's biggest consultants when it comes to analysing this sort of data. 2025, perth leads 4% from their article, followed by Canberra, melbourne, brisbane, adelaide, hobart and Darwin. They tend to be probably the suburbs we hear the most. When people ask, well, if you're not buying in Sydney, where are you buying? That list seems to come up most common.
Speaker 1:Sydney versus Melbourne has always been a really, really controversial topic's kind of head to head, I think like uh people from melbourne said they are great. People from sydney said they are great, so it's a yeah a losing battle.
Speaker 2:From what we can see here, um, you know, for the for the year ahead, um, they actually come in very, very similar and that's the funny thing here is we're splitting hairs in some cases. I think you find there's micro markets within the broader sydney and melbourne market as well. Um, you know, what we see on the northern beaches is polar opposite to what eastern suburbs and western sydney sometimes is reporting. Yeah, I'm sure you'll find the same in melbourne, but the, the bottom line is here. You've got to be making, I think, local decisions, uh, and talking to local agents and then doing the same thing when you're comparing apples for apples. Just taking that into consideration, because it's not a real one-size-fits-all like these numbers here.
Speaker 2:They they're good for insight, but they're not really going to be the bottom line this is definitely.
Speaker 1:This is like the average. Like if you have like 10 different suburbs, they just make a good average. Like when they do Sydney, it's all of Greater Sydney, yeah, and like Billy just mentioned, in Sydney, east, west and North, they all are performing different at the same time. So a very good example, just in terms of rentals In Northern Beaches people are still struggling to find any property, the one they want. There's lots of people for open home. They get snagged at day one. But then I had a family member looking, uh in the south, uh in the sutherland, sutherland area, and they were saying, ah, their properties everywhere. Like they got application from two different properties, yeah, right, and here, like it's even lucky if you get application approved, yeah it said both.
Speaker 1:Our Sydney is a roughly, I think, 40 kilometres away and you see that much difference, yeah, so you know, while looking at the whole stat, it's kind of an average of each suburb and you kind of have to dive deeper into where do you want, because one area is doing better than the other yeah, yeah, absolutely and and and.
Speaker 2:Quite often it's a short-term trend. You've got to look at these things over a 10-year cycle. Northern beaches property that you know value over a 10-year period is just astronomical. The sustained capital growth and it's compounding. It's compounding every year on year. It's not just a quick two to three year rise on the back of smaller sort of reasons, it's you know. An example of that is infrastructure. You know you're not finding a suburb in parts of Sydney and Melbourne that just have these two to three year growth periods. Just because a new airport or train station went in Somewhere like the Northern Beaches, you're blind buying blue chip stock. Um, with compounding capital growth over a long 10-year period, it's really crazy. But 2025, uh, again splitting hairs. Canberra and melbourne they're saying 3.5 percent forecasted growth, sydney, 3.3%. And for 2026, they are saying Melbourne 6%, sydney 7.8%. There you go.
Speaker 1:Double than last year. Okay, I've doubled in this year. So, right, you know, if you look at perp, it's from four to 4.6, but sydney and melbourne, they've pretty much doubled it yeah, but there's a lot going on as well. Like I was literally looking at it yesterday, I was trying to find that. You know there's new metro lines now around around sydney. How does it affect the server price?
Speaker 1:yeah so I looked at, uh, the hill, the hills district, uh, so the metro is going through castle hill and all the area, but right next door is balkan hills, which is a very big suburb as well. Yeah, so in the last three years, castle hill has gone up by 76 percent wow because of the metro. But the neighboring server, balkan hills, has only gone 37. Yeah, wow, just the difference of that metro and that accessibility has, uh, made a big difference. So, so I think, if I'm a buyer looking to get into some location like that, there are new metros that are getting built right now, so I think I would be looking more into that if I'm in Sydney, so I think it'll be the same in Melbourne, perth or Adelaide, like you know what is the next infrastructure happening.
Speaker 2:Infrastructure is certainly, you know, a big government, you know. Drawructure is certainly, you know, a big government, you know draw card for you know, impacting local property prices. Also, population growth where the population is being distributed it tends to be away from capital cities. You know Sydney and Melbourne. There's so much competition as it is the government's encouraging people to start their Australian experience outside of these two capital cities. So again, that makes a bit of a difference.
Speaker 2:The you know which, again, is not reported in the news. It's, I reckon, buyers agents have a huge impact on big time on local, and what I mean by that is is buyers agents or property advisors, such as accountants, solicitors, who are experienced in buying interstate. If they're reporting to clients that Perth or, you know, tasmania, these regional parts of Australia that are experienced great growth, and if they're buying and investing, you know, interstate, then there's a huge flow of cash flow there as well, definitely, because I think if I'm a buyer, I would look for a source and at this stage, if you're not a real estate agent, your only source is your local news or your buyer's agent.
Speaker 1:Yeah, like whatever you hear while scrolling on social media, I'm like, oh, actually that might happen, because I've seen a lot of my own families they take that influence saying, oh, there's a new airport being in western, uh, sydney. Now the property price will go up and now they are bought all the way, all the way there and traveling almost two hours, uh, one way for work. Yeah, because they say, oh, yes, they were influenced by the news, or people now saying that Perth is going so high up it's again another controversial topic. Yeah, like you, buyer's agents do help people buy interstate as well. So you know who you're talking to and I think there's a lot of influence around and, like Billy mentioned, the best information you can get is from your local agent.
Speaker 2:Yeah, certainly. I think local agents are going to give you the insights you really need, and everyone's strategy is going to be different as well. There are locations which experience really high growth, but if it's an investment mindset, you then got to consider rental yeah, you know yields and also vacancy, because you don't want to be stuck with a long-term property that you can't rent. So there's there's other considerations there. I think my takeaway from the data we've just had a look at and and the experience we, we, um, you know conversations we have day in and day out is it's a long-term decision. Um, if it's done right, it has huge long-term gains.
Speaker 1:Um, if it's done wrong, it's got, you know, long-term pain as well definitely, and at the end of the day, you want to decide as well, like is that going to be a forever home, or will it be outgrowing that in a while, or is that going to be investment?
Speaker 2:because everyone has a different.
Speaker 1:Uh, you know outcome from the investment. Someone good rental yield so it pays itself off. Yeah, uh, some one mind a bit lower rental yield but want a really high capital growth yeah, so when they sell they have that big, almost double double their their investment. So uh, depends what you're actually after.
Speaker 1:So if I have a million dollars and let's say I'm a young couple. I think Northern Beach is a perfect suit. You can buy a good two-bedroom apartment close to the beach, good lifestyle, 30 minutes from the city. But if I have a growing family I might go towards the west where you can probably buy a house.
Speaker 2:Yeah, affordability, I guess, is again what brings people back to these decisions. But there are still affordable price points, even within expensive cities and, as you said, it might not be the type of property you would live in. But if it's an investment and think of it like your million-dollar pot of cash, where can I best protect that asset? Then think of it as an overall decision, like that.
Speaker 1:And you've definitely got to do your research as well, not just follow social media saying, hey, sydney has done this and Melbourne has done this, because, like we mentioned, they talk about the whole of Melbourne and the whole of Sydney. So do research, not because something looks cheap or looks attractive. You've got to do your research because if your first property you do it wrong, it's a big, big hole that you're in so it'll take a while to climb out of it.
Speaker 2:Yeah, and if you've got a local experience already and it's sort of under your nose, then you're going to know a lot about your local suburb anyway. It's the small things like knowing which street you know is the best in the area, when are your local school catchments, Where's your public transport links. So if you can buy local, at least for your first one, you're going to be experienced with all that knowledge. That's very good.
Speaker 2:You know otherwise. It's a little bit like flying to a holiday destination and picking your hotel just based off of Google reviews. Definitely, and picking your hotel just based off of Google reviews might be great for you might be bad, exactly.
Speaker 1:You've got to experience it firsthand, and I think you get more confidence as well when you're buying somewhere local, like if I grew up in an area. I know every street, I know every shop, I know if I buy a property it's a lovely livelihood.
Speaker 2:You know, like the area is very good so.
Speaker 1:I think that's from my end.
Speaker 2:Do you reckon Sydney's got any more? Or is it cooked? Oh way, way more, got more to go.
Speaker 1:I think it's one of the most beautiful city out there that everyone looks forward to come come into. Yeah, uh. Yes, the entry level price is a bit tough in terms of buying entering to your first property, but once you enter I think it has a lot of lot of uh potential there. Sir, they recently had the zoning change, so you know that has a huge impact. There's constantly new opportunities. Exactly so. Like you know, property still went up, so now there's more room for you know your property value to go up.
Speaker 1:So I think, you know, it's what you call the golden goose that keeps on giving you the egg, so it's never backing down.
Speaker 2:There we go Signing off. I hope that helps. If you need any help, just give us a call. If you want more information on the zoning policy changes, sms the word zoning, rezone, rezone yeah, rezone to 0460. 0460-111-111. 111 111 111 and we'll send out some info. But yeah, there's a lot of information there and hopefully this will help Just unpack the Sydney versus interstate decision.
Speaker 1:And we're always here to help. Yeah.
Speaker 2:And tell you something in Sydney. Yeah, all right, take care guys, see you later.