Monthly Sydney Property Insights

The red needle on a speedometer speeds toward the year 2010

The red needle on a speedometer speeds toward the year 2010

Welcome to our last CurtiseCall for 2009. Although hard to believe, another 12 months in Sydney’s property market is drawing to a close and compared to this time last year, what a year it has been!

2009 – the year that was

As the global financial crisis quickly receded from view, buyers in the sub $1 million bracket returned to the auction rooms encouraged by the historically low interest rate environment, resilient employment rates and government largesse in the form of the first home owners’ boost scheme. Since the last CurtiseCall on 1 November 2009, these factors have combined to produce some of the strongest clearance rates on record particularly in Sydney’s inner west.

The story above $1 million has been the same throughout Sydney: plenty of buyers but a chronic shortage of quality housing stock; particularly in Sydney’s upper and lower north shores and eastern suburbs.

A narrow window of buying opportunity on the lower north shore closed in the past six weeks with prices heading north in response to the imbalance between supply and demand. On the lower north shore, that trend began in Neutral Bay and Cremorne before reaching Mosman.

A Federation home at 25 Queen Street, Mosman which sold on 5 August 2008 for $2.285 million traded again on 5 September 2009 for $2.15 million whereas 50 Cowles Road, Mosman which sold for $2.6 million on 11 June 2008 delivered that owner a capital loss on 17 September 2009 when it sold for $2.4 million.

Starting with 36 Aubin Street, Neutral Bay which sold on 14 November 2009 for just under $3.2 million – (well above the highest bid of $2.91 million at auction on 1 October 2009), the trend continued to reverse this month with two bidders pushing 45 Upper Avenue Road, Mosman to $2.477 million on 5 December 2009. That figure was $77,000 over the reserve and represented a $277,000 capital gain on its purchase price on 9 May 2008.

Two transactions in the bellwether Sydney suburb of Paddington revealed a similar trend across the Harbour Bridge.
The first was the highly publicised sale of a derelict terrace in a prime location at 40 Windsor Street, Paddington which sold on 23 November 2009 for a staggering $1.895 million.

The second was a 1970’s town house down the hill in a mosquito infested gully at 18B Harris Street, Paddington. With north to the rear bush and a Balinese inspired makeover, this property sold without fanfare at auction on 28 November 2009 for $1.805 million which was $300,000 above the price range being quoted four hours before the auction. Before leaping to report a suspected case of under quoting, the sale of 4 Harris Street, Paddington on 5 May 2009 for $1.345 million should be considered.

Balinese themed architecture also helped the sale of 1 Neild Avenue, Paddington on 30 November 2009 for $3.331 million.

Closer to the City at 71 Womerah Street, Darlinghurst, a four level terrace with DA approved parking and internal access on the high side in the suburb’s prime street sold for $1.85 million on 5 December 2009.

The big eastern suburbs news item in this period was of course, Lachlan Murdoch’s purchase on 5 November 2009 of La Manoir at 93 Victoria Road, Bellevue Hill for $23 million. This was followed by the sale of the iconic, but nearly dilapidated Jenner House at 2 Macleay Street, Potts Point for $15 million on 5 December 2009; a property that has been on and off the market for at least four years. The other glamour transaction was of the four bedroom penthouse with panoramic views of Bondi Beach at 16/16 Notts Avenue, Bondi which sold for $8 million on 12 December 2009.

Not everything in Potts Point’s top end was buoyant. In a move reflecting the slump in Sydney’s ultra top end penthouse market, Ashington eventually conceded defeat by advertising its DA approved development site at 10 Wylde Street, Potts Point for sale on 3 November 2009.

A similar fate met the block of seven apartments at 8 St Neot Avenue, Potts Point. A reduction during the sales campaign in the initially suggested $4 million price tag was apparently insufficient to prevent this property being withdrawn from its scheduled 3 December 2009 auction.

Above $3 million in the Sydney prestige property market, quality stock remained in tight supply and turnover thin relative to previous years.

In Sydney’s inner west, activity above $3 million was more patchy than elsewhere in the Sydney prestige property market apart from two transactions. The sale of 272 Johnston Street, Annandale on 7 November 2009 for $4.86 million made headlines whilst the quiet achieving Haberfield continued to set records with 14 Waratah Street selling on 28 November 2009 for $3.452 million. Haberfield in fact has enjoyed the highest turnover of inner west properties in this bracket since 1 November 2009.

Another solid sale occurred on 14 November 2009 with 11 Northcote Road, Glebe going under the hammer for $1.7 million.
Newtown was relatively subdued with 7 Warren Ball Avenue, Newtown North generating surprisingly little excitement being passed in at auction on 5 December 2009 for $1.605 million – a long way short of the vendors’ $1.8 million expectations shortly before that auction. The property is still on the market.

On the north side, 12 Parkes Street, Kirribilli sold on 5 December 2009 for $4.7 million and 30a Addison Road, Manly sold on the same day for $4.265 million.

2010 – the year to come

Curtis Associates predicts these trends for next year:

  • The short supply of quality housing will more than offset increases in interest rates.
  • Consistent with recent remarks made by the Deputy Governor of the Reserve Bank of Australia, buyers will continue to regard Sydney property as offering an affordable investment destination once low interest rates and rising disposable incomes are taken into account.
  • During the first quarter of 2010 in the sub $1 million bracket, there will be relatively more buying opportunities for both owner occupiers and investors as the first home owners’ grant further reduces.
  • Turnover as well as prices will increase in the $1 million to $3 million bracket as confidence returns especially to those employed in the financial and professional service sectors.
  • The last mentioned trend will see big ticket buyers above $3 million tempted back into the Sydney prestige property market later in the year.
  • As part of the emerging trend, 2010 will be busier than 2009 which was much busier than 2008 especially at the top end.



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