John McGrath, founder of ASX-listed real estate agents McGrath, today clarifed his position about the state of the Sydney property market.
“The Sydney market is most of the way through its sales cycle and very near the top of its cycle. My view is there is no bubble, and no chance of a 40% correction,” he says.
According to a report by Mortgage Business, McGrath told the AussieThink conference on the Gold Coast earlier this week that Sydney’s market was approaching the end of the current price cycle.
The article on the industry news site quoted McGrath extensively.
“I don’t see any material capital growth in the next few years,” he told the conference, according to the article, adding that “we [McGrath] think the Sydney market is 40% overvalued”.
However, McGrath issued a statement this afternoon saying he was “misquoted” in the report “and wishes to clarify his position”.
McGrath said Sydney was overvalued relative to other parts of Australia but he did not foresee a 40% correction in prices.
“The market continues to have strong drivers including deep demand, populations growth, overseas investment and low interest rates,” he said.
“There is a possibility of a small and short correction of a few percent, and I believe that is healthy for the sustainability of the market.
“Yes Sydney is overvalued compared to other areas of Australia, however it is a world class international city and a major financial centre. I’ve long said that South East Queensland is undervalued and shows great growth potential.”
Business Insider reported on the comments today and has contacted Mortgage Business for comment.