February Market Update

The Sydney property market continued to show resilience in February, with home prices rising by 0.40% for the month, bringing annual growth to 3.94%. While affordability remains a challenge for some buyers, the market has been buoyed by the Reserve Bank of Australia’s (RBA) recent 0.25% interest rate cut, which has sparked renewed confidence among both buyers and sellers.

Locally, the Hunters Hill and Ryde areas have seen strong demand, particularly for well-presented family homes and townhouses. With stock levels remaining tight, competition has intensified, leading to higher auction clearance rates and solid price growth in certain segments.

Hunters Hill & Ryde Market Overview

In February, buyers in Hunters Hill and Ryde remained active, despite ongoing affordability concerns and economic uncertainty. The recent interest rate cut has encouraged more people to re-enter the market, particularly first-home buyers and upgraders who had been waiting for signs of stability.

At auctions, competitive bidding has been a common theme, particularly for properties in high-demand school catchments, near transport links, and lifestyle amenities. Well-priced homes have continued to attract multiple offers, with some exceeding price expectations due to the strong interest.

However, the market remains price-sensitive, meaning that buyers are still selective. Properties that are well-presented and priced correctly are selling quickly, while those in need of updates or priced too ambitiously are taking longer to move.

Rental Market: Tight Conditions Continue

Sydney’s rental market remains under pressure, with vacancy rates tightening even further in Hunters Hill and Ryde. Demand continues to far outweigh supply, leading to rising rental prices and increasing competition among tenants.

Several key factors are contributing to these conditions:

• Population growth: More people are moving into Sydney, increasing demand for rental properties.
• Limited new housing supply: Construction of new homes and apartments has slowed, leading to fewer rental options.
• Investors holding off: Some property investors have been hesitant to re-enter the market due to economic uncertainty, leading to fewer rental properties becoming available.

As a result, renters are finding it harder to secure homes, with many properties receiving multiple applications within days of being listed. This trend is expected to continue, particularly in sought-after suburbs like Hunters Hill and Ryde.

Impact of the Interest Rate Cut

The RBA’s 0.25% rate cut, which lowered the cash rate to 4.10%, has played a crucial role in boosting buyer confidence. Many prospective buyers have seen their borrowing power increase slightly, while those who had been sitting on the sidelines are now feeling more optimistic about entering the market.

One of the most immediate effects of the rate cut has been higher auction clearance rates. February saw an increase in properties selling under the hammer, as buyers rushed to secure homes before prices potentially rise further.

However, despite this renewed enthusiasm, affordability remains a concern. With property prices still high and cost-of-living pressures affecting many households, it’s unlikely that we’ll see dramatic price spikes—rather, steady and sustainable growth is expected in the months ahead.

Looking Ahead: What’s Next for the Market?

As we move further into 2025, the Sydney property market remains in transition. The key factors shaping the months ahead include:

• Interest rate stability: If rates remain steady or continue to drop, buyer confidence is likely to strengthen.
• Housing supply: A shortage of listings could continue to drive competition and price growth.
• Investor activity: If more investors return to the market, the rental crisis may ease slightly, but this remains uncertain.

For those considering buying, selling, or investing, it’s essential to stay informed and seek expert guidance. The team at Nicholls & Co is here to help you navigate the market and make informed decisions.

If you’d like to discuss how these changes impact your property goals, reach out to us today!