The problem for residential property in Sydney is the lack of supply. Sydney is surrounded by national parks and water. Two narrow corridors to the South-West and North-West offer the only options for expansion. New city hubs in places like Singleton or Goulburn with high-speed rail to Sydney make good sense. However, they require long-term planning and investment. In the meantime, expect burgeoning pressure on inner city house and apartment prices from increasing demand driven by; more foreign students, more immigrants and rebounding green/sea changers who found it boring.

By the time property sales data is collected and then analysed, it is often many weeks or months (for settled sales) out of date. Sentiment in the Sydney residential market is prone to fast change. To find out what is really happening speak directly with an agent on the frontline. We are regularly called by property journalists, solicitors and financial advisers to provide an unvarnished appraisal of what is happening now.

The pandemic has left a large hole in the budget. Higher interest rates will make that worse. Expect governments to look for options to raise more revenue. The first call will be superannuation concessions. Next, we predict the 50% capital gain discount on investment properties (held for over 12 months) will look attractive with halving to 25% a possibility. Is it time to review your potential Capital Gains Tax liability?

The ACT and NSW have led the way in the inevitable move from one off stamp duty to a yearly land tax on residential property. We expect a slow spreading of the concept nationwide despite Labor’s roll back in NSW. It will produce a more mobile workforce with lower barriers to purchase, especially for first home buyers.