It’s a Sydney tradition. Your first rental is a small unit in Surry Hills or Bondi. The first apartment you buy is in Alexandria or Erskineville. But when you want some space, while maintaining easy access to the city, you buy a house in the heart of the Inner West.
This has been a trend in Sydney property for the past 30-odd years; it’s had a marked impact on some Inner West communities – and it’s only going to get stronger.
My daughter’s dance classes are in Earlwood where it’s commonplace to hear Greek. My niece plays football for Leichhardt APIA where the clubroom is wall-to-wall Italian. But my son’s school is in Petersham where Portuguese is heard less-and-less.
There are many great reasons for living in the Inner West. Before, many leapfrogged the Inner West to get to the burbs, leaving it to the industrial classes who were often poorer migrant workers. But now, much of it is des res – look at the deli in Haberfield on Saturday!
As a result, houses in Marrickville and Dulwich Hill soared in value by 30 percent in 2016. While Haberfield, Leichhardt and Concord climbed by more than 20 percent.
So, what’s the future for Inner West property?
Property Price Trends
The title ‘Inner West’ is really a catch-all – there is no consistency between the new apartments of Zetland and the old large villas in Birchgrove. And, as a result, they face very different property trends.
Alexandria and Erskineville rely heavily on investor demand. Across the country, investor demand is cooling due to restrictions imposed on the banks and because it’s harder for overseas investors to buy property. In the next couple of years, there is not much likelihood of price growth.
This is particularly the case in the suburbs, such as Bankstown and Waterloo which have seen a sudden rush of new apartments that have been built. Near us, heaps of apartments are being completed in Lewisham/Summer Hill – along the Light Rail line and Homebush is awash with new-build.
But there is still strong demand for owner-occupied properties. With the lenders offering variable rates as low as 3.59 per cent, many homeowners have never had such affordable repayments. That Sydney tradition continues, when inner city types want to start a family they buy a house a few stops along the T2
Inner West owner-occupied property is only going to get stronger over the long term. This is particularly the case in the suburbs which have more (larger) owner-occupied houses in the $3m+ market such as Drummoyne, Balmain, Summer Hill and Gladesville.
So, what’s driving Inner West property growth?
Inner West Property Fundamentals
What have London, Paris, New York and Sydney have in common? They all have populations that increasingly want to be within a short commute of the city centre. And the Inner West is a major beneficiary of this global trend.
With two train lines and the light rail running through them, Inner West suburbs are likely to see strong demand from cashed-up professionals.
And, with initiatives such as the Greenway linking the Cooks River to Iron Cove, the Inner West will become an increasingly pleasant place to live – shedding its tired industrial feel. As my wife and I left the Palace cinema the other night after watching a French movie we noticed how much North St had changed.
In fact, there is even a downside to this trend as the well-paid designers and solicitors move in, they will displace some of the old immigrant communities. I remember, when we were buying our family home, every open home in Leichhardt was one of those outdated Nonna houses featured in Looking for Alibrandi.
Increasingly the retirees living in the Inner West will be cashed-up, manage their own Super Fund and have a weekender in the Blue Mountains
And, because more-and-more people will want to live in the Inner West, every piece of land could be used for housing.
The Inner West: More Cranes & More Hammers
There are a few large tracts of land that inevitably have apartments on them. Last week, a family friend went to buy some wood from a timber yard near Canterbury station, only to discover it had been replaced by a 12-storey apartment block!
Next, we will see swathes of apartments along the old rail lines of Eveleigh and Rozelle.
But, as Australians increasingly move into apartments, we are likely to see pockets of units and town houses popping up – especially along railways lines or major roads. Got a run-down house with 400+m2 of land? Chances are a developer will knock on your door wanting to buy it.
So, Why the Inner West?
The North Shore has the bush, the Eastern Suburbs have the ocean. But the Inner West is where it is happening. You can get into and out of the CBD easily, a walk around Iron Cove always invigorates, properties will have good long-term growth.
But, for us Inner Westies, it’s the opportunity that presents; Sydney is over 200 years old, yet the Inner West has only been really desirable for the past 30 or so. While it is not a blank canvas, there is plenty of scope to craft change in the Inner West. The Shire thinks it’s God’s Country but the future is the Inner West; the factories are gone, the river is clean, and the possums are returning.
With a combination of city and space, the Inner West is where it’s going to be.
If you would like to chat further about the Sydney property market please feel free to contact me on 1300 30 67 67.