Pete Wargent blogspot

Co-founder & CEO of AllenWargent property buyer's agents, offices in Brisbane (Riverside) & Sydney (Martin Place), & CEO of WargentAdvisory (providing subscription analysis, reports & services to institutional clients).

5 x finance/investment author - 'Get a Financial Grip: a simple plan for financial freedom’ (2012) rated Top 10 finance books by Money Magazine & Dymocks.

"Unfortunately so much commentary is self-serving or sensationalist. Pete Wargent shines through with his clear, sober & dispassionate analysis of the housing market, which is so valuable. Pete drills into the facts & unlocks the details that others gloss over in their rush to get a headline. On housing Pete is a must read, must follow - he's one of the finest property analysts in Australia" - Stephen Koukoulas, MD of Market Economics, former Senior Economics Adviser to Prime Minister Gillard.

"Pete is one of Australia's brightest financial minds - a must-follow for articulate, accurate & in-depth analysis." - David Scutt, Business Insider, leading Australian market analyst.

"I've been investing for over 40 years & read nearly every investment book ever written, yet I still learned new concepts in his books. Pete Wargent is one of Australia's finest young financial commentators." - Michael Yardney, Australia's leading property expert, Amazon #1 best-selling author.

"The most knowledgeable person on Aussie real estate markets - Pete's work is great, loads of good data & charts, the most comprehensive analyst I follow in Australia. If you follow Australia, follow Pete Wargent" - Jonathan Tepper, Variant Perception, Global Macroeconomic Research, author of the New York Times bestsellers 'End Game' & 'Code Red'.

"The level of detail in Pete's work is superlative across all of Australia's housing markets" - Grant Williams, co-founder RealVision - where world class experts share their thoughts on economics & finance - author of Things That Make You Go Hmmm, one of the world's most popular & widely-read financial publications.

"Wargent is a bald-faced realty foghorn" - David Llewellyn-Smith, 'MacroBusiness'.

Monday, 11 July 2016

Are Sydney apartment prices still rising?

The answer is, uh, it depends.

Fact is, at this stage in the cycle there are a great many unattractive high-rise apartments being built, many of them in second-rate locations. 

No scarcity, and not that much demand, which is not a great combination.

To be blunt, these property types will struggle at this stage in the cycle, and it may not be that easy to fund a tenant either. 

Spacious and well-appointed or well-designed units in boutique blocks may generally fare better. 

Location will obviously be an important factor. 

The above having been said, some Sydney markets are still performing well, most notably the lower north shore and the eastern suburbs. 

A 2 bedroom, 1 bathroom, 1 parking space apartment in this block with 119 square metres of internal space sold for a thumping $2,425,000 on Saturday. 

A rare price, possibly a lower north shore record of some sort, with punchy strata levies to boot.

But - it does have a rare view, a genuine point of scarcity.

5/1 Cremorne Road, Cremorne Point

Rest assured there is no oversupply of properties like this one, and accordingly it commands a price tag to match. 

This underscores that while data providers tend to lump all townhouses, units, and apartments in to one heaving vat of data (although some indexes are stratified), not all such properties are created equal. 

Properties with a point of scarcity - in locations that are fully built out and appeal to cashed up downsizers - may outperform over time. 

The Cremorne apartment above once sold for $287,000 in 1987, and since that time has delivered capital growth at a compounding annual rate of 8 per cent.

That said, the rate of growth over the past ten years has been somewhat slower, at about 5 per cent (or a total of 63 per cent nominal growth over the past decade).