Surging capital growth in Sydney

Sydney-is-the-ideal-location-for-capital-growth-_157_6003287_0_14101781_300New South Wales has long been considered the perfect location for property investment, with Sydney at its financial heart. Recent research from CoreLogic RP Data confirms that when you are looking for the greatest capital growth opportunities in Australia, Sydney offers investors the best return on their purchase.

Tim Lawless, head of research at CoreLogic RP Data, said that Sydney and Hobart are the two cities to watch for growth in 2015. While these capitals are polar opposites in some respects, impressive value growth in both locations offers investors some unique potential for wealth creation.

“Sydney is the market to watch for the most capital growth in the coming year,” said Mr Lawless. “It’s the most expensive market to buy into but it’s still going strong.”

Median dwelling prices in the harbour city have swelled 13 per cent in the 12 months to January, providing investors with an impressive 17.5 per cent total return on their investment. Affordability pressures are apparent, however, with the surging value meaning that the median house price sits at $850,000 and units are at a staggering $605,000.

Interestingly, while Sydney has remained the most attractive option for investors seeking strong capital gains, the most significant value increase over the past three months was recorded in Hobart. Prices here rose 4.4 per cent, outstripping Sydney’s 2.4 per cent rise in capital gain.

The record low cash rate is only expected to add fuel to the fire, with the RBA taking particular caution towards the Sydney market over the next few months.

“The Bank is working with other regulators to assess and contain economic risks that may arise from the housing market,” RBA Governor Glenn Stevens said.

These figures show that when looking for an investment property that will provide strong returns, Sydney continues to top the list. Get in contact with your local real estate agent if you would like to find out more about what high capital growth would mean for your property portfolio.

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