Prime property in sydney shows signs of recovery

The firm’s latest report shows values increased by 7.9 per cent in the Australia city in June 2013 compared to June 2012 - a significant turnaround from the overall price decrease of 0.9 per cent recorded in 2012.

The rebound has been attributed to improved confidence from buyers, boosted by low interest rates. Sellers are becoming more confident too, offering fewer discounts on properties, which has helped to support prices.

As a result, Knight Frank now forecasts that prime property prices in Sydney will continue to grow for the rest of 2013 by 5 per cent. Prime property prices remain 17 per cent below 2007 levels, though, while property prices in the mainstream market have grown by 14 per cent in the same period.

“The lower interest rates, which are at a 53 year low, and increased market liquidity in lower price brackets has seen a rebound in volumes and auction clearance rates. However, the market remains relatively balanced between vendor and purchaser expectations,” reads the report.

“This has seen the broader mainstream market record some flattening out in prices over the first half of 2013, albeit strong results continue to be achieved for the best properties.”

Knight Frank predicts that there will be continued demand from Asian buyers, particularly from China but also Singapore, Malaysia, Indonesia and India.