SYDNEY property had a stellar 2013, with the market recovering to the previous heights of 2010 and then surging forward in the second half of the year.
Some experts believe 2014 will bring similar success, as the city settles into the growth phase of a new property cycle.
The Daily Telegraph asked some of real estate’s leading experts for their 2014 predictions:
McGrath Estate Agents CEO
Predicts 5-10% growth
Sydney will benefit across the board in 2014, with likely growth between 5 and 10 per cent. The best performing markets are likely to be beachside and inner city suburbs.
The inner west area south of Parramatta Rd will benefit, with Petersham, Stanmore, Dulwich Hill and Summer Hill performing well. Ironically, the best bargains will be in areas like Palm Beach and Whale Beach.
They have been oversold in recent years and there is a 12-month window to get value there.
A number of suburbs will also benefit from improving infrastructure. The new rail link to the northwest will boost the Hills district and suit suburbs like Rouse Hill, Castle Hill and Bella Vista.
The new inner east light rail will benefit Kensington and Kingsford, as will the influx in Chinese buyers looking to purchase close to major educational institutions.
Scroll down for NEW HOMES IN SYDNEYS’ FIELD OF DREAMS Exclusive Alicia Wood
LJ Hooker head of network
Interest in Sydney’s west
The 2013 success was driven by a shortage of quality stock, post-election job confidence and record low interest rates.
None of these will change during 2014 and a large pool of buyers will be hungry after missing out in 2013.
People will look for inner city living opportunities and Paddington and Woollahra have opportunity for growth after being subdued.
The pressure on the inner west is likely to continue.
People will look for value in places like North Ryde, which offers a convenient location and more land.
There has also been strong interest further out in areas like Guildford, Granville and Merrylands, which offer larger family homes.
Empire Property Portfolios CEO
Beaches the big winners
What has happened in 2013 may just be the tip of the iceberg for the next cycle.
Properties under $1 million will still be in short supply and high demand and growth will spread to more properties in blue chip suburbs and affordable regional areas. Bondi Beach will perform as there are thousands who will pay any price to live near the beach. Coogee attracts a different demographic of city workers and beach lovers who like more of a village life.
Kirribilli has always been a favourite of city workers and a unit that ticks all the boxes will always be in demand.
Cremorne offers peace and quiet with easy access to the city, cafes and shops. Balmain is one of the best for the inner west lifestyle, still with access to harbour ferries and the city.
Wilson Property Agents director
Prestige to rise
Lower and mid-level markets will continue to be popular due to positive economic factors.
The top end above $2 million will gain momentum throughout the year. Suburbs within 5km of the Sydney CBD will do well due to high demand but the beaches and coastal suburbs will also have a high performance rate in 2014.
A number of prestige properties that have been on the market for several months are now trading and achieving good results, showing renewed confidence at the top end of the scale. It is only a matter of time before momentum builds and the prestige section starts to pick up.
RP Data national research director
Low rates continue
Growth rates in Sydney are likely to slow from the highs recorded over the second half of 2013. This does not mean there will be another price correction but that growth will slow to more sustainable levels, in line with income growth.
Population growth remains strong, which implies demand for housing and is a positive for the economy.
Mortgage rates are likely to remain low in 2014, meaning investment in housing should remain strong.
On the other hand, rental yields have fallen as values rose faster than rental rates.
The typical yield for a Sydney house is now just 3.9 per cent, which will send investors looking for better value in other high-yielding cities such as Brisbane.
Another factor is affordability, as the Sydney median price is now about $700,000.
Key market segments such as first homebuyers and low to average income families have struggled to find funds for a deposit as values have grown.
NEW HOMES IN SYDNEYS’ FIELD OF DREAMS Exclusive Alicia Wood
MORE than 3000 homes will be built in Sydney’s southwest next year, after the state government rezoned a swathe of land in the Catherine Field precinct near Campbelltown.
NSW Premier Barry O’Farrell will today announce the rezoning, which will see 3200 homes constructed in the new suburb next year.
Figures from the state government show there has been an 80 per cent increase in the take-up of first-home owners grants on last year – with 6000 people receiving the $15,000 grant for buying new properties.
Mr O’Farrell said releasing land for new developments was important to drive down the cost of home ownership.
“We are making homes more affordable and in the process western Sydney is being transformed into a tradies’ paradise, with the creation of thousands of jobs in construction,” Mr O’Farrell said.
“The rezoning of land at Catherine Field being announced today tops off a bumper year in NSW, with a massive number of home approvals and a huge increase in the take-up of the NSW government’s First Home Owner Grants.
“The latest figures released by the Australian Bureau of Statistics show 44,628 new homes were approved in the 12 months to October 2013, the highest level since 2005.”
Developers for the Catherine Hill project will pump $30 million of infrastructure funding into the region, including an upgrade for Oran Park Drive, land for a new primary school, and the construction of a main sewerage line.
Planning Minister Brad Hazzard said land will go on sale in 2014, and the houses will be complete by 2015.
It is a win for the government, which last year,the government failed to pass landmark planning reforms, after a stalemate in negotiations with the Labor Party and crossbenchers in the upper house.
The government has gone back to the drawing board on the legislation, and has until February to find a solution