- Sydney home prices have fallen by 6.1% over the past year. Property listings are also significantly higher than a year ago and there’s also a record supply of homes on the way, indicating that it’s currently a buyer’s market.
- With the proportion of rental properties sitting vacant also rising, it now looks like Sydney is a renter’s market, too.
- Data from SQM Research shows weekly rental rates for houses and apartments have both fallen over the past year.
For the first time in a long time, Sydney home prices are falling.
According to data released by Corelogic on Monday, Sydney’s median home price has fallen 0.5% in the past four weeks, extending the decline over the past year to 6.1%.
Auction clearance rates in the city continue to hover at around 50%, akin to levels that have coincided with annual price falls of 5% in the past. Property listings have also increased over 20% compared to a year ago, a result partially reflecting that it’s taking longer for the average home to sell.
What’s more, according to data released by the ABS in July, there was a record number of houses and apartments under construction in the March quarter of the year, meaning there’s no shortage of new supply on the way.
While some may disagree given the base that prices are falling from, it’s easy to understand why many believe Sydney is now a buyer’s market.
Prices are falling and there’s plenty of stock to choose from — a scenario very different to periods of the past.
Based on the chart below from Macquarie Bank, it looks like Sydney is not only a buyers market at present, but also a renters market, too.
It shows Sydney’s rental vacancy rate based on seasonally adjusted data from the Real Estate Institute of Australia, including more timely monthly information from the Real Estate Institute of New South Wales as well as SQM Research.
Both monthly indicators suggest vacancy rates are now at more than decade highs, meaning there’s an increasing proportion of rental stock that currently sits unoccupied.
“This accords with anecdotes of the balance of power shifting to renters,” Macquarie says.
It’s also placing downward pressure on rents, even with strong levels of population growth.
According to SQM Research, the average weekly rental rate for Sydney homes has fallen 3.4% over the past year, and 0.7% for units.
For those seeking out new digs in Australia’s largest city, be it to rent or buy, the market is working in your favour for the moment.
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