It’s that time of the year again!
After another rollercoaster of a year – complete with lockdowns, the easing of restrictions, the swearing-in of a new federal government and a substantial interest rate rise – we now bid farewell to FY22 and look toward the year ahead.
We want to take this opportunity to provide you with an update on the current market (especially in the wake of the RBA rate rise), as well as outline some of the fantastic results that we’ve continued to see here at Upstate over the last 12 months.
We’ll also give you our predictions for Real Estate as we start the new financial year.
Let’s get into it.
Our take on the current market
Residential Real Estate
In just the past month, the NSW state government has announced the trial of a shared-equity scheme aimed at helping first-home buyers get their foot in the door of the property market. Meanwhile, the Premier has also made clear his plans for stamp duty reform, which will see some property owners move to paying an annual land tax, rather than making a hefty upfront payment at the time of purchase.
Amongst all this, the RBA has also moved in consecutive months to raise the Cash Rate to 0.85%. For many homeowners, this increase is uncharted territory, and it has seen more borrowers start to move away from fixed-rate home loans, settling instead on the lower variable rates on offer.
This rate rise has meant that we’ve started to see a correction in property prices across Sydney’s Northern Beaches, however, this is no cause for concern.
Most suburbs in the region have grown by 60-70% over the past couple of years, meaning that even areas experiencing a correction of 20-30% are still ahead by 38% in the long term.
As for the rental market, our Business Development Manager, John Hall, tells us that it is holding stable at a very strong level.
He says, “Upstate are still achieving great results in a quiet market, as we tend to pick trends before they happen. With this, we can tailor our marketing campaigns around new properties for lease to ensure we are still creating competition around open homes and maximising rents and opportunities for our landlords.”
Some recent results from the weekend that was. Our current vacancy rate is 0.9%, we currently have 19 properties for lease and saw 65 prospective tenants through these properties. Our current average days on market sits at 10 – meaning that most of the time we are renting out properties after the first open home.
Commercial Real Estate
On the commercial front, Vincent West, Director and Commercial Licensee, explains that the Northern Beaches commercial market has exhibited resilience throughout the pandemic uncertainty.
“The industrial sector saw an increase in demand and lack of supply resulting in vacancy rates less than 1%. Office space benefitted from the work-from-home shift, with companies moving to smaller satellite offices, causing a flow on effect to retail with increased traffic around local cafés, restaurants and shops,” said Vincent.
Upstate’s results for 2021 – 2022
Once again, we’ve seen great results across the board here at Upstate over the last financial year.
First, looking at our leased properties, we leased 60 additional properties this year compared to FY 20/21! This is all while the number of leased properties actually declined across the Northern Beaches area.
FY 20/21 Total Leased – 690 VS FY 21/22 Total Leased – 751
We also blew our Highest Leased Price for FY 20/21 out of the water.
FY 20/21 Highest Residential Leased Price – $2000 VS FY 21/22 Highest Leased Price – $2900
As for property sales, we’ve maintained a higher than Average Auction Clearance Rate despite the quieter market sitting 12.5% above the Sydney average.
Looking at our recent sales, the brilliant Michelle Jones sold 436/17 Howard Ave, Dee Why off-market in just 7 days, netting $2,004,000 for her ecstatic vendors.
Meanwhile, Tulo Sila and Frank Livoti just set a street record with the sale of 9 Henry St, Dee Why for a whopping $3,139,000. And the highest residential sales price was a whopping $10,000,000.
Truly outstanding results all around.
Our property predictions for the FY23 year ahead
While we don’t have a crystal ball, we do have a great track record of predicting the trends and outcomes that we are likely to see ahead of us.
The Upstate Finance team suggests that the RBA have a Cash Rate target in mind that they’re looking to get to, and they want to get there as quickly as possible. Once there, we will see a period of calm as the effects begin to show in our economy. This may then lead to a Cash Rate decrease in due time.
Our BDM, John Hall, believes the rental market will remain strong with a vacancy rate of 0.9%.
“I think we will see those who don’t need to buy now will instead rent to try and predict a drop in the market and subsequently buy then. I can also see some people selling their home and going back to leasing for a year or two to also try and predict and capitalise on a drop in the market,” says John.
As for the future of Sydney commercial real estate, Vincent West explains that “only time will tell what is to come for the commercial sector, however, with the reducing supply and increasing demand I believe we will see the commercial sector only remain as strong as ever. As we have seen during COVID, the market can adjust even in the toughest of times.”
FY 21/22 highest commercial sales price was $26,000,000.
To help our vendors keep up to date with real-time property updates and activity we have just launched Australia’s FIRST EVER Commercial Vendor App.
This year marks a significant milestone for us, our brand, our team and our community. This year, we are 100 years young, built on a proud legacy of vision, ambition and evolution.
Our story begins when one of our parent companies, ‘Weight and Co’ was established in 1922. Since then, we’ve purchased, merged and evolved to become the market-leading pioneers we are today, based on our confidence, enthusiasm, sincerity, innovation and ultimately, a deep seeded passion for what we do.
While our heritage spans over 100 years from strong foundations, we’ve transformed to help everyone find themselves in a better place. We’re excited for an even more prosperous future by embracing the best technology, delivering exceptional customer experiences for our clients and our people.
To coincide with our 100 year legacy, we are proud to have launched the first edition of US magazine, where we provide you with an insight into the brand through a beautifully finished coffee table magazine. Get to know US by clicking here.
We’ve grown in size with a team of 85 staff members who are here to help you get the results you have longed for.
Whatever the future may hold, we look forward to the year ahead and everything that it has in store for us here at Upstate and across the Northern Beaches.
As always, whether you’re looking to buy, sell, rent or lease, Upstate is dedicated to being right by your side throughout your journey to help you find yourself in a better place.