- Sydney unit prices have dropped by $20,000 since March 2020
- House prices have gone up $13,000 above mid-2017 peak to $1,211,488
- The gap in median and unit house prices continues to widen
Domain’s House Price Report has revealed that whilst Sydney’s house prices have continued to rise, the value of units has gone down, widening the gap between the median values of the two type of dwellings.
The median house price in Sydney has continued to rise to levels beyond the previous peak. The current median house price of $1,211,488 – which saw a 4.8 per cent during the December quarter – is $13,000 above the mid-2017 price peak.
House prices only saw a short 2.2 per cent decline in the middle of last year.
However, unit prices have taken a $20,000 dive compared to levels seen in pre-pandemic March, making the median $729,840. This therefore has made the gap widen to over $481 000 – which is rare considering house and unit prices tend to follow the same direction.
Explanations for this widening include lifestyle changes occurring because of the pandemic. With working-from-home arrangements becoming more prevalent, the report argues buyers are after more spacious homes where there can be more privacy and dedicated home office space.
Weaker investor activity has also likely impacted unit prices disproportionally, the report argues, as investors are traditionally more attracted to units instead of houses.
More homes have been listed and a higher number of auctions were held in the final quarter of 2020 compared to the final quarter last year, showing that sellers have responded to surge in demand.
Now it remains to be seen whether unit prices will recover and increase in line with house prices.