Louis Christopher, managing director of the property data firm SQM Research, said it is not surprising that affluent areas have been underperforming compared to cheaper suburbs in the harbour city.
“Sydney’s west has been the star performer over the past three years, with units in the south-west region increasing by 52 per cent and reaching a median price of $439,000,” he said.
“Parramatta was the standout house performer, recording 53 per cent growth and a median price of $931,000. Investors and owner-occupiers, particularly first home buyers, have been driven west due to the high property prices in the inner-city areas.”
Meanwhile, Mr Christopher said units with a median price of $729,500 in Sydney’s lower north shore grew by three per cent, while houses with a median price of $2.250 million grew 0.1 per cent.
“Investors have been looking at the numbers and realised that they can obtain two properties for the price of one if they purchase in cheaper areas and gain must stronger rental yields,” he said.
However, Mr Christopher said the tables are expected to turn in 2016, with affluent suburbs set to be the growth performers in Sydney.
“One of my top tips for the coming year includes the eastern suburbs, with growth predictions between eight to 13 per cent,” he said.
Mr Christopher added that a Sydney property crash was unlikely in 2016 despite many forecasting otherwise.
“Sydney’s economic credentials are looking strong for the year ahead with a low interest rate environment set to continue, low supply levels, rising employment figures and major infrastructure plans already underway,” he said.
“It is also the best performing state in Australia according to the latest Australian Bureau of Statistics figures until June 2015, reaching 5.9 per cent growth.”