The post-election property market bounce continued last weekend highlighted by the sale of an entry-level one-bedroom apartment in North Sydney that sold for $709,000 under the hammer.
Angus Raine, Executive Chairman, Raine & Horne, said, “Many of the offices I have spoken to or visited over the last two weeks are reporting their phones started ringing again on the Monday morning after the election. This underlines once again that consumers don’t like uncertainty.”
The one-bedroom apartment at 22/7-17 Berry Street, North Sydney attracted 17 registered bidders to the onsite auction, which drove the price above expectation according to selling agent, Todd Houghton, from Raine & Horne North Sydney. The property had a price guide of $650,000-$700,000.
“Only two bidders requested amendments to the contract before the auction, so we were expecting perhaps 3-4 bidders,” Mr Houghton said. “We had 17 bidders all with chequebooks in hand.”
“To more than triple this number of bidders was amazing, and it’s mostly attributable to the removal of the threats to negative gearing and the capital gains tax discount following the retention of the Federal Government on May 18.”
A first-time rentvestor secured the entry-level, north-facing, 50 square metre apartment, with investors representing around 30% of all enquiries. “Before the election, there were no investors in the Lower North Shore market,” commented Mr Houghton.
“There’s pent up demand for properties in North Sydney, Waverton, McMahons Point and Kirribilli as people were waiting to see how the election panned out, while an interest rate cut whether it’s June, or later in winter, will keep the market’s newfound confidence rolling along.”
Mr Houghton added the new Sydney Metro station at North Sydney and the move by Channel 9 to anchor the new commercial tower at 1 Denison Street were attracting the attention of savvy investors. “The new tower at 1 Denison and the high-rise tower at 100 Mount Street will bring an additional 6,000 workers to the North Sydney CBD.
“These people need to live somewhere, and many will want to be close to work, and this tenant demand will help investors with their rental yields.”
James Pratt, CEO, James Pratt Auctions International, who successfully sold the Berry Street apartment under the hammer added, “Buyers are showing more motivation at auction since the election and registration numbers have improved by as much as 30% in some Sydney suburbs.
“Last weekend we had an auction clearance rate at 66%, which is the highest since the start of winter 2018.”
In Sydney’s southwest Peter Diamantidis, Sales Manager, Raine & Horne St Marys has been flooded with requests for one-on-one property appointments since the election.
“We sold seven properties in the first week after the election and seven last week. It was lucky if we sold ten properties a month before the election,” Mr Diamantidis said.
“Apart from the election result, our buyers are being contacted by their brokers in the wake of APRA’s calls for lenders to scrap the 7% mortgage interest rate test.
“Consequently, for some properties we are attracting as many as 18 groups to open homes whereas before the election buyers were very thin on the ground.”
To demonstrate the post-election effect and improved market confidence, Mr Diamantidis sold a two-bedroom apartment in St Marys for $309,950. “The property only listed on Tuesday, May 21 and it sold for the asking price four days later,” he said. “We haven’t seen this level of activity and buying since 2016.”