Sydney’s property market has kicked off January in positive flow

Welcome to the new year, which from a sales perspective has already launched with far more enthusiasm than the finale of 2024. Our initial wave of new listings coming to market in January has been matched with improved buyer interest, engagement and strong numbers at our open homes.

We’re already averaging 27 buyers per property open, which is incredibly strong and indicates that Sydney’s property market could be slowly crawling out of a slower period that saw hesitation and prices easing. There’s increased hope that interest rates will be cut this year. It’s really just a matter of time and when that occurs, confidence will improve off the back of strengthening borrowing power and increased liquidity.

Before delving much deeper into forecasting, it’s been intriguing speaking with a wide range of people across the country and abroad over the summer break. They continually reinforce that for all of Australia’s issues, when compared to what’s unfolding across much of the globe, we’re blessed to live in a safe and beautiful country. This sentiment definitely lingers somewhere in our minds when we’re considering where to live and going through the major process of purchasing a property.

So, we now turn our attention to the year ahead, and the early signs are certainly positive. The first half will be active with a high volume of property already available. We have strong chatter about rates being cut and a Federal election that needs to occur before the end of May. We’re also coming off a weak close to 2024 that will require a shift to restore buyer confidence.

The Australia Financial Review surveyed Australia’s leading economists and property experts who agreed that until rates are cut, Sydney property prices are likely to continue their softening trend. As we closed off December, Sydney had recorded price declines – the first in two years. That said, the data is always well behind what’s unfolding at the coalface. Speak to any estate agent across the city and they will tell you that buyer hesitation and easing prices were evident from the middle of 2024.

Therefore, it’s a reasonable assessment to assume that the property experts and economists will be wrong with their timing once again. What we typically see is that buyers will engage on the future narrative of rates being cut. The stronger this likelihood becomes across the media and rhetoric from the RBA, buyers will pivot and make decisions on what is likely to occur. If the first RBA meeting confirms that rates will be cut in the coming months, this will be enough for many buyers to act on this messaging. Moreover, we also see banks loosen lending and start to drop rates in anticipation.

We’re far more optimistic than the economists and property experts as we can sense the shift in mood quickly. We can look at buyer discussions and a willingness to make offers very rapidly, which becomes widespread market behaviour far more quickly than most expect. While it’s early days for 2025, there are some strong fundamental building blocks for a solid market being established. We’ll need to see some better consistency and monitor how buyers respond to an increasing volume of property set to come online in the coming weeks, however with online enquiry high and foot traffic at inspections rising, we’re off to a more than positive start.