STANDOUT LOCATION:

1 City of Wollongong

Buyers continue to seek an affordable lifestyle close to the capital city and Wollongong fits the bill for Sydney residents. It has a strong local economy, a sizeable infrastructure spend and a coastal lifestyle at decent prices.

The NSW economy ranks second last among the states and territories, according to the State of the States report published by CommSec in October 2022. This has coincided with the decline in the Sydney property market.

Many analysts have incorrectly linked the decline in Sydney with the rise in interest rates. Hotspotting analysis shows the Sydney market peaked in mid-2021, fell away gradually in the second half of 2021, then slumped substantially in the March quarter of 2022. Prices were starting to react to that before May 2022 when the Reserve Bank started raising rates.

There was a further decline in the June quarter, but some evidence of revival in the September quarter. There has been a gradual improvement in auction clearance rates, despite higher listings, and a slowing in the rate of price decline, as recorded by PropTrack and

CoreLogic. Meanwhile, SQM Research’s prices index indicates that Sydney prices were recovering in late 2022.

Louis Christopher, of SQM, in his Boom and Bust report, published in November 2022, predicts Sydney will lead price revival across Australia in 2023. Areas that offer a degree of affordability are likely to lead in the Greater Sydney market.

Regional NSW will be a multi-speed market. Some locations are rising but the iconic sea-change destinations that were at the forefront of the previous price boom are now in decline. Another iconic market well past its peak is the Southern Highlands.

The key areas that look likely to grow are Newcastle and the Hunter region, and Wollongong and nearby LGAs like Shellharbour and Shoalhaven. Demand in these markets was rising as we entered 2023.