October saw interested buyers flocking to the shores of Sydney's Northern Beaches, lifting property values in the area with recent results coming in at an astounding $300,000 over the asking price in some instances.
During the last week of September, the Northern Beaches achieved an incredible Auction Clearance Rate (ACR) of 87%. This followed the success of last quarter when the Northern Beaches were recorded to have beat all other Sydney areas for the month of August, coming in above average at a high of 80% and raising the overall Sydney average to 79.8%.
According to CoreLogic, Sydney house prices overall have risen for the fourth month in a row. ACRs have been recorded at their highest for the months leading up to October since mid-2017, pointing to the market recovering from the loss of momentum felt in 2018 and early 2019.
"During the last week of September, the Northern Beaches achieved an incredible clearance rate of 87%"
Several factors are contributing to the increase in property prices in the Northern Beaches with the strongest of those being population growth, a greater number of buyers due to interest rate cuts by the Reserve Bank, and continued increase in consumer sentiment.
Despite the difficulties in entering the market for first home buyers, home ownership continues to remain a top priority for many young Australians hoping to secure their first property, with 56.6% of first home buyers relying on parental or familial assistance to secure their deposit.
Location, lifestyle and community: The Northern Beaches has it all
The Northern Beaches is well known for incredible views largely undisturbed by the kind of foot traffic found on Sydney's eastern suburbs. In fact, prospective buyers include those who are looking to leave Sydney's east for quieter pastures across the bridge.
The area boasts secluded suburbs, top schools, access to national parks and wildlife walks, and for many it is still only a bus or ferry ride to the CBD. Buyers acknowledge these features and are prepared to spend well over the expected market value for their desired lifestyle and home.
In addition to the lifestyle aspects of the Northern Beaches, there is also very little available compared to other areas of Sydney, so the number of interested purchasers is greatly outnumbering the properties available.
Australians are not the only ones sold on the Northern Beaches. The area is attracting international interest, particularly for suburbs boasting water views and large blocks. Clontarf, one of the area's most exclusive suburbs saw its biggest sale of the year of over $9 million to an international investor. This significant sale was well over the suburb's average house price of $3.035 million.
Northern Beaches hot spots and rising potential
In addition to a lower median house price compared to its neighbouring suburbs, prospective buyers are attracted to property listings which include large blocks with bigger houses of 4 to 5 bedrooms.
The suburb's projected 5 year growth remains at a high 36.8%, which is a promising statistic for buyers looking to make a sound investment, as well as current investors who may be considering selling over the next few years.
"Unit prices in the Northern Beaches have had strong growth over the past four months while median unit prices across Sydney dropped by 6.9%"
It's not only large family houses that are proving popular in these suburbs. Unit prices in the Northern Beaches have had strong growth over the past four months while the median for units in the Sydney market dropped by 6.9% during the same period.
According to Smart Property Investment, yields of up to 5% have been felt by investors with units in Narrabeen, Avalon, Dee Why and Balgowlah. Unit affordability in these suburbs is in the realm of possibility for the entry-level investor with listings around the $500,000 mark.
Other popular suburbs include Manly, known for its supportive community and recently rated as one of Sydney's top liveable suburbs according to a survey published by McCrindle, Narraweena, which is forecasted to grow its median house price by up to 30% over the next three years, and North Balgowlah which has experienced a YoY rental increase of an incredible 19.6%.
Sydney property market forecast for a seller's market
As we enter the last quarter of 2019, we can expect to see strong clearance rates as families look to secure their new home before the end of the year. This trend will remain with analysts predicting that property prices are likely to continue to rise across the country through to the end of the year, and grow across all Australian capital cities until 2021.
In the wake of three consecutive cuts to interest rates by the Reserve Bank since June, more buyers are entering the market again, contributing to rising property values and competitive auction results.
With Sydney's property marketing displaying a rapid recovery, analysts are advising that prospective buyers and investors can expect to see continuously strong growth in throughout these suburbs over the next five years.