What Is Next For The Market?

The simple answer is more of the same. More listings, more sales, price growth as consumer confidence rises and interest rates fall and an incredibly tight rental market. Also it appears that the federal election policy promises will steer clear of any changes to property.

In my many chats with people this week, one particular conversations made me think. We were talking about the massive difference in house prices compared to normal 1 and 2 bedroom units prices especially in Manly. A semi can sell for up to $5,000,000, whereas a 1 bedroom unit sells for $1,000,000 and the medium 2 bedroom unit price is $1,700,000. Growth in the smaller unit prices has been stagnant for the last 3 or 4 years. The median house price in 2020 for Manly was $3,100,000 it is now $5,200,000 (Pricefinder.com.au). The gap has increased significantly over the last 5 years. My thoughts are that the smaller apartments are undervalued especially as the rents can be $900 pw for a 1 bedroom apartment with no parking. As interest rates fall, and rents continue to rise first home buyers and investors will step back into buying mode and push prices up.