Thu. Sep 28th, 2023
Sydney real estate: Areas where homes are selling for biggest and smallest discounts
Sydney real estate: Areas where homes are selling for biggest and smallest discounts

There has been wide variance on how final prices and list prices compare.

More than half the properties changing hands in some regions of Sydney and its surrounds are trading for below the list price as sellers’ once lofty price expectations come crashing back to earth.

Exclusive data showed the gap between the final price and list price varied considerably by region, with properties in “lifestyle” pockets on the city fringes tending to sell below list price more often.

It’s a reversal of the conditions seen during the height of the pandemic when FOMO, or the fear of missing out, was rife among buyers and most properties sold for well above the asking price.

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This was especially true in regions popular with sea-change and tree-change buyers, which boomed in 2021 and early 2022 but now appear to be among the areas where buyers can play hard ball in negotiations.

House Price Drop

The Southern Highlands and Shoalhaven region had a high proportion of properties sold below list price in June at nearly 76 per cent, with 23 per cent trading at the asking price and only 1.4 per cent selling for over.

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In the Hunter Valley, the proportion sold below asking price was 57 per cent, while in Sydney’s St George and Canterbury-Bankstown region it was 54 per cent, according to the PropTrack data.

About 52 per cent of sales in Sydney’s southwest, which includes Liverpool and Fairfield, produced a result below list price. This excluded sales by auction.

The Illawarra, another boom market during the pandemic, saw 46 per cent of sales come in below the list price, PropTrack reported.

Properties were more likely to sell for over list price in cheaper areas.

PropTrack economist Anne Flaherty said the market was very different to a year or two ago, with rapidly rising interest rates putting downwards pressure on borrowing capacities.

“The average borrower has seen their borrowing capacity decrease by 30 per cent since rate hikes began,” she said. “In growing markets, sellers tend to underestimate their property’s worth, but in falling markets it can be the opposite … this data shows expectations need to change.”

Properties did not sell below list everywhere, with cheaper markets tending to see more properties sell at or over the list price.

This included the Blacktown area, where 20 per cent of transactions were above the list price and 51 per cent were at the list price.

About 38 per cent of northern beaches properties traded at prices above those listed, but a dive into recent sales showed most properties getting higher than expected results were cheaper units.

For sale sign on black board near the resedential building. Property Real estate concept

“There is a lot more competition at the bottom end of the market because that’s where interest rate rises have pushed a lot of buyers,” said Mortgage Choice broker James Algar.

“Our clients who are spending below $900,000 have really struggled. Once you get above about $1.3m, there’s not nearly as much competition.

“That’s because those buyers usually need a $1m mortgage and that means they need to be on at least $250,000 a year without children to get a loan at current rates. There’s not many households in that position.”

Buyer’s agent Michelle May said being able to get an offer accepted at under the list price depended heavily on the type of property being sold.

Freestanding houses in most areas were in short supply and hotly contested, so there was less wiggle room for negotiation, she said.

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“The seller’s motivation usually plays a big part. If it’s a divorce and they need to sell, they may be more open to dropping the price,” she said.

“But when it’s a quality property, it’s well located and it matches comparable sales, there is no point in low balling.”

Jane Thompson recently secured a unit in Summer Hill for a price she was “happy” with, but she said she benefited from knowing the apartment complex well, allowing her to make a quick decision.

“I already lived in the block. I didn’t have any doubts about it,” she said. “I felt like I had to move quickly because the market is getting more competitive again and there’s isn’t much stock.”


Mid North Coast 79%

Richmond-Tweed 77.62%

Central West 77.34%

Capital Region 75.58%

Southern Highlands and Shoalhaven 75.5%

Coffs Harbour-Grafton 75.27%

Murray 69.57%

New England and North West 69.23%

Riverina 64.29%

Hunter Valley, exc Newcastle 56.97%

Sydney-Inner South West 54.96%

Sydney-South West 52.75%

Illawarra 46%

Far West and Orana 45.45%

Sydney-Inner West 44.44%

Sydney-City and Inner South 41.18%

Sydney – Parramatta 38.96%

Sydney – Outer West and Blue Mountains 37.06%

Sydney – North Sydney and Hornsby 36.62%

Sydney – Eastern Suburbs 35.29%

Newcastle and Lake Macquarie 35.29%

Central Coast 33.16%

Sydney – Baulkham Hills and Hawkesbury 32.84%

Sydney – Northern Beaches 31.82%

Sydney – Outer South West 30.19%

Sydney – Blacktown 28.28%

Sydney – Sutherland 24.44%

Sydney – Ryde 22.5%


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