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Being so close to the airport, most
properties in Rockdale experience some
sort of aircraft noise. You’d think this
would deter buyers and renters, but it
isn’t the case, according to Smith.
“ It’s an element that’s been there for a
long time and it comes with living in an
inner city suburb,” Smith explains.
“ Be it St Peters, Tempe, Arncliffe or
Rockdale, they’re all impacted by aircraft
noise and it just goes with the territory.”
¿ ROCK-HARD SALES STONEWALLED?
Rockdale might be on fire, but how long
will it last? Ettia suspects prices might
stabilise once interest rates start to rise
but at the moment, the market is in
“ T hings are still selling within one or two
weeks,” Ettia says.
On the other hand, Smith believes
prices might plateau earlier, following
the recent Federal Budget. He says
consumer confidence might be dampened
somewhat and those rock-hard sales
could be stonewalled.
“ T here will certainly be a blimp in the
market. There will be a ‘wait and see’,”
“ I don’t think we’ll see the big increases
that we’ve seen reflected again. The heat
will be taken out. ”
He adds this will probably result in more
properties on the market. Buyers will
then have more choice and might delay
making offers. Instead of two or three
homes, they might have a choice of 15.
Those houses then take longer to sell and
other investors watch the market and stop
panicking they’ll miss out.
“ Others think they then have more
time and you get that rolling effect in the
opposite direction,” he says.
Another issue facing investors is that
prices may be rising, but rents aren’t .
The median weekly asking rent for a
house increased by just $15 over the past
year, from $550 to $565, while the median
rent for a unit remained unchanged at
$460 per week.
It means investors who buy now will
have to fork out more and likely be more
heavily negatively geared.
Smith says investors are probably
comfortable with negative gearing at
the moment but if interest rates rise, it
could put financial strain on those who
But Todd Hunter of wHeregroup warns
investors against buying in Rockdale.
“I wouldn’t be buying there whatsoever,”
“T he prices have definitely increased
way too much and I think the first signs
of slowing down are already taking place.
Auction clearance rates have already
come back slightly and it’s the first signs
of what’s going to happen.”
So when should you buy? Hunter
believes it’s not about waiting one or
two years – investors should actually
put on the brakes when it comes to the
Sydney market for the next three or
He says once interest rates are back
to seven or eight per cent, buyers who
overcommit will be forced to sell and
that’s when the bargains might pop up.
“In this market you sell, you don’t buy,”
He adds Rockdale is also “a bit of a
concrete jungle”, with hundreds of units
in the suburb.
“It’s hard to make money on properties
that are all very similar and that’s more
reason to shy away as well.” API
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High residential prices
not indicative of a bubble
Increased residential property prices in
Sydney, Melbourne and Brisbane are
a result of normal market movement
and not indicative of a property bubble,
according to a survey released by the
Australian Property Institute.
Seventy-four per cent of respondents
believe increased residential property
prices in Brisbane are a normal market
movement, while 59 per cent of
respondents thought the same about the
The result was more varied for Sydney,
with 40 per cent of respondents believing
increased prices were normal market
movement and 36 per cent saying it’s a
Australian Property Institute Victorian
president Aldo Galante says many first
homebuyers are finding it difficult to
enter the market, due to limited supply,
self-managed super funds, and existing
homebuyers looking to upgrade.
“The effect of this is most strongly felt in
Sydney,” he says.
“As a result, there are a growing number
of first homebuyers who are choosing
to enter the market by buying an
investment property rather than a place
of residence. This allows them to get on
the property ladder by buying a more
affordable property in an area they can
afford to buy in, but wouldn’t necessarily
choose to live in.”
Sydney’s residential market is expected
to peak and then slow down in late 2014,
according to the survey.
NSW \\ THE STATES
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