2021 has been an incredible year for the Sydney property market and the Darling Point real estate market has been one of the city’s standout performers.
2021: a year of strong growth
In the year to 30 November, the median Sydney dwelling price lifted an eye-watering 24.9%, according to CoreLogic. That means a Sydney property worth $3 million at the start of the year should theoretically now be worth almost $3,750,000.
Even through lockdown, when physical auctions were banned and open homes were off-limits, property prices continued rising. Buyers were confident in the fundamentals of the property market and this combined with low stock levels. These factors combined to send prices 5.7% higher over the September quarter, even though the city was in lockdown for almost the entire period.
When restrictions were lifted in October, we saw more properties hit the market, giving buyers greater choice. But the price growth continued, with another 2.4% rise added over October and November.
In fact, Sydney’s median house price has risen every single month this year.
A tale of two markets? Not in Darling Point
One factor that has been much talked about in Sydney property’s stellar year has been the widening gap between house prices and apartment prices. While house prices lifted 30.4% since the start of the year, apartment prices lifted “only” 15.2%.
But this hasn’t been our experience here in Darling Point.
CoreLogic data reveals that the median Darling Point apartment price actually rose 35.5% over the past 12 months – the fifth-highest growth rate of any apartment market in the country.
So, far from lagging, apartment values here have outperformed even the impressive rise in the Sydney median dwelling price.
What’s behind Darling Point’s standout performance?
Perhaps the main reason that our area has performed so well is simply its status as a premium, blue-chip area. Darling Point has the third-highest median apartment value of any suburb in the country at $2,405,976. Only Point Piper and Barangaroo boast a higher median value – although both suburbs saw far fewer sales than Darling Point and were bolstered by a few ultra-prestige sales, including three apartments in 1A Barangaroo that sold for more than $40 million.
CoreLogic notes that during the upswing phase of the housing cycle, the prestige market tends to see higher growth rates than other sectors. We also note that the underperforming market sectors tended to be dominated by investors, who stayed away due to higher vacancy rates.
Just researching the market?
Unlike most apartment-focused suburbs, Darling Point skews heavily towards owner-occupiers, with only around one-third rented, compared to two-thirds in nearby Potts Point.
Who was buying in 2021?
In line with this, we noticed some buyer groups were particularly active in the Darling Point this year. The most notable was downsizers, many of whom had recently benefited from selling their family home in a strong market. These buyers were generally looking for quality properties that gave them room to move, as well as some level of ‘wow’ factor. Where better to find that than right here?
A second group we noticed was young professionals, including young professional families. Many of these were already local buyers. Having children was once a reason to move further away from the city centre, but today we find buyers are more likely to want to stay close to the area they know and love. This means we saw a lot of these buyers looking to upgrade from a two-bedroom to a three-bedroom apartment.
As a result of the strong demand from downsizers and upgraders, three-bedroom apartments far exceeded even our impressive median – so much so that the median three-bedder now sells for $4.4 million, according to Domain (up from $2.9 million in 2019). Meanwhile, the median two-bedder sells for $1.7 million.
What to expect for 2022
Despite media reports of a slowing property market, we expect growth to continue well into next year. After all, there are still many buyers in the market and there is not enough quality stock to satisfy them.
That said, we believe growth will be more sustainable next year and that we won’t see the runaway market of 2021. This should make 2022 a good time to buy and sell because buyers themselves usually have to also secure somewhere to move into. When they do, hopefully, it will be in a fairer market where they have greater choice and don’t have to make a rushed decision on their next step.
That’s it from us in 2021. We hope you have a wonderful and relaxing break and look forward to seeing you again in 2022!
If you’d like to know more about our local property market, or if you need help buying or selling a home, get in touch.