Sydney property rise tops bar one

SYDNEY’S property market outpaced all other major Australian cities except one last year, according to figures from analyst RP Data.

Home values rose 1.5 per cent over the year, bettered only by Darwin, the standout performer, where they rose 8.9 per cent.

But there was a 1 per cent drop in Sydney’s median dwelling values in December on the previous month, RP Data says.

A senior research analyst, Cameron Kusher, said that although Sydney had performed significantly better than the previous year, over a five-year period the city’s level of growth in value was underwhelming.

”During 2011, values were down 2.4 per cent … but if you go back a bit further, in 2010 values increased by 6.3 per cent and in 2009 they increased by 14.2 per cent,” he said.

The key driver of the Sydney market, according to Mr Kusher, was high demand for apartments, for which values rose by 2.3 per cent compared with houses at 1.3 per cent.

”It comes back to their location and their affordability,” the analyst said.

”If you look at the median price of a house and a unit, units are $165,000 cheaper.”

The senior economist at Australian Property Monitors, Andrew Wilson, agreed it was the lower and middle end of the Sydney market that was driving the price growth.

”Between $600,000 and $1 million is definitely where the drivers of the Sydney market have been this year, and the prestige market has certainly continued to drag the chain overall in the market,” he said.

”We really were struggling to see any sales above $2 million in that December period.”

It is not surprising the best performing regions over the year were the more affordable areas – the inner west, Canterbury Bankstown and the south-west.

Prestige regions such as the the eastern suburbs and the lower north shore consistently recorded lower auction clearance rates.

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