The time is right for Sydney empty-nesters to cash in on the best market conditions in three years by listing their homes for immediate sale advises Angus Raine, Executive Chairman, Raine & Horne.
“The Sydney market is motoring along due to a combination of low-interest rates, population growth, improving rental yields, 80% auction clearances, mounting buyer and investor enquiry levels, and an easing in mortgage lending conditions,” says Mr Raine.
“At the same time, buyer confidence is bullish, with the latest research from AMP Capital showing the Sydney property market has grown at an annualised rate of 19.6% over the last three months.”
However, agents from the Raine & Horne network in Sydney are reporting a significant shortage of homes for sale. “The decision by many empty nesters to remain in oversized family homes is stymieing housing supply,” Mr Raine said.
“The hesitation to move is possibly due to legacy issues such as Australia’s recent political instability, lending handbrakes and faltering market returns since 2016.
“Even with improved market commentary since June, many empty nesters continue to sit on their hands and subsequently there is a lack of listings across the metropolitan area but particularly in tightly held regions such as Sydney’s Upper North Shore and the Inner West.”
He continued, “To be fair, many retirees can’t afford to downsize because of the prohibitive costs involved in rightsizing into a smaller home. Stamp duty breaks for downsizers is one initiative the state government might consider to encourage empty nesters to move.”
Listings shortage on the Upper North Shore
In Pymble, on Sydney’s Upper North Shore, the median house price is a substantial $2.4 million, according to Raine & Horne, while the region’s prestigious private schools are central to the region’s appeal for upgraders.
“If you are selling a large family home in Pymble, Gordon, Turramurra, St Ives or Wahroonga, the time is perfect because there is a shortage of listings in our region,” said Wayne Walter, Principal of Raine & Horne Pymble/Gordon.
“Yet with the lowest ever cash rate of 0.75% coupled with the relaxation of the 7% mortgage rate serviceability test, well-heeled buyers are better placed to borrow than twelve months ago.
“The political certainty delivered by the May Federal Election result has also fuelled buyer confidence.”
Mr Walter continued, “While we can’t predict what listing volumes will be like next year, we know with certainty that listing volumes are low now. This means the market is running in favour of sellers on the Upper North Shore.”
Many North Shore downsizers prefer to spend their retirement years in the region rather than shifting to the coast or closer to the city, according to Mr Walter.
“Many empty-nesters from the Upper North Shore have developed friendship and network groups and prefer to stay in the local area rather than downsizing to the Central Coast, the Northern Beaches or the inner city.”