NAB forecasts significant surge in Sydney house prices this year, up by 6.9%, with a potential increase of 11.8% next year—Sydney auction clearance rates reach 70%.

Week’s Key Focus

NAB predicts a substantial 6.9% increase in Sydney house prices this year, marking a notable turnaround from the previous forecast of a 2.2% decline.

The bank projects further growth of 4.9% by the end of next year, totaling a two-year increase of 11.8%. NAB adjusted its price forecast due to the surprising resilience of the housing market, as sustained demand and limited supply offset the impact of rising interest rates.

NAB’s Chief Economist, Alan Oster, notes that the short-term outlook for housing demand is robust, expecting a stable or slightly positive trend in house prices for the remainder of 2023. NAB still foresees two rate hikes this year, raising the cash rate to 4.6%, but anticipates a return to normal interest rates next year, which would support housing price growth.

Since the reopening of international borders in early 2022, Sydney has experienced a strong population rebound, driving increased housing demand. The need for additional living space during the pandemic also contributed to the market’s resilience.

Australia’s real estate market has outperformed expectations, with NAB’s residential property survey revealing a significant boost in confidence among real estate professionals. These experts expect national house values to rise by 0.6% in the next 12 months, with a long-term forecast of 1.7%.

However, rising interest rates continue to be the primary constraint for existing property buyers nationwide, while in states other than Western Australia, the main obstacle for prospective buyers is a lack of supply.

The survey found that real estate professionals believe expediting planning permits and development would be the most effective means to address Australia’s housing shortage. They also support financial incentives such as low interest rates and tax benefits.

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Auction Results This Week

  • Sydney: 589 properties were auctioned, with 392 reported results, and 276 sold, resulting in a clearance rate of 70%. The total value of auctions reached AUD 312,433,300, with a median house price of AUD 1,400,000.
  • Melbourne: 570 properties were auctioned, with 417 reported results, and 274 sold, leading to a clearance rate of 66%. The total value of auctions amounted to AUD 208,518,321, with a median house price of AUD 840,000.

Top 5 Auction Prices in Sydney Last Week: Houses

▼TOP 1. AUD  $6,663,000

Address: 6 Adina Rd, Curl Curl NSW 2096

Land Size:  670 sqm

House | 5 Bed | 2 Bath | 4 Parking

▼TOP 2. AUD  $4,055,000

Address:9 Florence St, Strathfield NSW 2135

Land Size:  708 sqm

House | 5 Bed | 2 Bath |2 Parking 

▼TOP 3. AUD  $3,850,000

Address: 50 Llewellyn St, Rhodes NSW 2138

Land Size:  696 sqm

House | 6 Bed | 2 Bath | 1 Parking

▼TOP 4. AUD  $3,700,000

Address: 66 Mi Mi St, Oatley NSW 2223

Land Size:  708sqm

House | 5 Bed | 3 Bath | 2 Parking 

▼TOP 5. AUD  $3,650,000

Address: 87 Edenholme Rd, Wareemba NSW 2046

Land Size: 663 sqm

House | 3 Bed | 2 Bath | 3 Parking

Top 5 Auction Prices in Sydney Last Week: Units

​▼TOP 1. AUD   $4,700,000

Address:  20/132 Bower St, Manly NSW 2095

Unit| 2 Bed | 1 Bath |1 parking

▼TOP 2. AUD   $2,475,000

Address: 19 Little West St, Darlinghurst NSW 2010

Duplex | 2 Bed | 2 Bath 

▼TOP 3. AUD   $2,050,000

Address:  2 Jellicoe St, Concord NSW 2137

Duplex | 3 Bed | 2 Bath  | 2 Parking

▼TOP 4. AUD   $1,890,000

Address: 105/183 St Johns Av, Gordon NSW 2072

Townhouse  | 3 Bed | 2 Bath  | 3 Parking

▼TOP 5. AUD   $1,820,000

Address:6A/45 Ocean Av, Double Bay NSW 2028

Unit| 2 Bed | 1 Bath   | 1 Parking

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