Sydney home prices are expected to grow by as much as 23 per cent over three years, according to new data.
The report from property industry analyst and economic forecaster Oxford Economics Australia predicts relatively slow home price growth will persist across Sydney for the remainder of the 2024 financial year before gaining pace in both FY25 and FY26.
According to the Residential Property Prospects report, which forecasts property prices and the rental market to 2026, unit price growth in Sydney will outpace that of house prices through to the end of June 2026.
Oxford Economics expects unit prices will grow by 23.4 per cent over that period, with house prices expected to rise by 15.8 per cent.
That would take Core Logic’s Sydney’s median unit value past the $1m figure to $1,029,869 and the median house price past the $1.5m mark to $1.621930.
Capital city performances have diverged in recent months. Total listings have risen in Melbourne and Sydney, a trend we expect will continue in coming quarters, acting to slow price growth,” said Maree Kilroy, report author and Senior Economist at Oxford Economics Australia. Tailwinds will serve to propel prices in Perth, Brisbane, and Adelaide. Low levels of advertised listings and affordability in pockets will prop up prices in these cities next year. Interest rate cuts from late 2024 should boost credit availability, accelerating broad price growth once again.
In regards to Sydney: “Increasing an estimated 10.3 per cent over 2023, Sydney’s median house price is estimated to have exceeded its previous peak in the December quarter 2023, reaching $1.6 million,” the Oxford Economics Australia report reads.
The report from Oxford Economics Australia expects this trend to continue through early 2024, resulting in house price growth of only 3.3 per cent, and 5.2 per cent for units in FY2024.
Oxford Economics Australia expects the relatively cheaper price point of units to help back stronger growth near term. Sydney’s median house and unit price are forecast to increase 5.9 per cent and 8.3 per cent per annumc respectively over the two years to June 2026.
