How home prices will change in 2021

PHOTO: Multiple suburb records for house prices were smashed this year – particularly at auction. Source: Supplied

Uneven market conditions are expected to dominate Sydney property sales next year until international travel resumes and adoption of the COVID vaccine becomes widespread, real estate group Raine and Horne has revealed.

Raine and Horne chairman Angus Raine said the patchy market conditions would be characterised by weaker demand for apartments within inner suburbs and strong demand for other housing categories.

“Our view is that housing markets will be strong in 2021 while international borders will hamper inner ring apartment markets until we see planes start landing once again,” Mr Raine said.

“Once immigration starts up again, and we can get a COVID jab, apartment markets in the capital cities will take flight again, especially given Australia’s fantastic response to the pandemic.”

The Raine and Horne group is forecasting 5-8 per cent average growth in real estate prices for Sydney over 2021 and more for regional NSW, which was a standout market this year.

Sydney prices grew by an average of 4 per cent in 2020 and growth over 2021 could be stronger because of renewed confidence in the market, cheap credit and a shortage of listings.

Strong growth in regional NSW real estate was partly the result of more work from home arrangements encouraging Sydneysiders to look for properties further out.

“It’s been a watershed year for regional NSW with average growth of 7 per cent as more Sydneysiders fled the city lockdowns to the Central and south coast, and many regional towns and cities,” Mr Raine said.

“The action hasn’t just been confined to the big regional cities such as Wagga, Bathurst and Orange.