Has Sydney’s property market peaked?

105One industry commentator has suggested that the Sydney property market has peaked – news that should encourage homeowners and investors to hold on to existing property rather than selling now in order to buy later.

If the predictions are indeed true, first home buyers may be afforded an opportunity to buy property in coming years, should the market drop.

Is Sydney going soft?

Residex Founder John Edwards has suggested in a March 26 post that the Sydney market is beginning to soften.

Mr Edwards also stated that the market may have already peaked, having observed Residex data that pays attentions to cyclical property trends over the last 14 years.

A lack of strong consumer sentiment was cited by Mr Edwards as a reason for the property market as it currently stands to fail to “stretch much beyond its current level”.

Sydney has acted as a reference point for other Australian property markets, making this analysis potentially salient should the predictions be correct.

Long-term activity in Sydney’s property market was also observed, going back to the 1980s. According to Mr Edwards, a downward growth pattern is obvious.

Differing commentary

However, other industry commentators have anticipated growth – albeit slowed – during the early part of 2014.

Whether the market goes as soft after this is yet to be seen.

“Prices growth in Sydney and Melbourne is set to be significantly less in 2014 compared to 2013 with most activity occurring over the first half of the year,” noted Australian Property Monitor Senior Economist Andrew Wilson in the House Price Report: December Quarter 2013.

With a range of perspectives available, it’s important for investors and home buyers to pay careful attention to opportunities in the market while working to minimise their risk.

Ensuring a diversification of assets and paying attention to historical trends can help achieve this.

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