Sydney property market to bottom out later this year, modest price growth next year: new forecast

PHOTO: Median house prices in Sydney are forecast to bottom out at just about $1 million, a new report finds. Photo: James Alcock

Sydney’s biggest correction in house prices since the 1980s should be over by year’s end but there is no sign of a return to boom times, according to new forecasts.

Domain’s property price forecast for June 2019, released on Wednesday, expects median house prices in Sydney to bottom out at just about $1 million and median unit prices to dip just below $700,000 in spring.

The market is tipped see a modest turnaround next year, a forecast supported by low interest rates, strong population growth and ongoing low unemployment.

House prices are expected to increase by 3 to 5 per cent over next year, while unit prices are forecast to rise by 2 to 4 per cent.

Domain economist Trent Wiltshire said the trifecta of an interest rate cut, the Coalition’s election win and potential lending rule changes helped the market bottom out sooner than expected.