2024 Summer Property Market

Welcome back to those who took some much-needed time out over the Christmas/New Year Summer holiday period. This period is usually slow for the Sydney Real Estate market as agents take a much-needed break, and Sydney buyers switch off for a few weeks of vacation.

In our first newsletter for 2024, we’re going to briefly look back at the final months of 2023, then project forward to the remainder of the summer 2024 Sydney Property season.

2023 was the year of surprises in the Australian property market, with a background of upward-spiralling inflation and, as a consequence, increasing interest rates, the year was expected to produce a rush to sell by over-leveraged property owners, particularly those coming off fixed-term low-interest rates, causing a downward property market. Instead, the year started with sellers sitting on their hands, starving supply, while buyer demand remained strong, exerting mild upward momentum on pricing, particularly in the single dwelling housing market.

Moving through the year, the spring season started early and strong with more supply balancing out the higher demand witnessed earlier in the year. As a Buyer’s Agent attending numerous weekly auctions over this period, it was apparent we were in a multispeed market, with some auctions receiving record numbers of attendees and selling well above market, while others fell silent, leaving excellent buying opportunities for the well-informed. Yes, there are still good buying opportunities in much of Sydney if you’re fully engaged with the market.

At MCS Buyers, our experience of the 2023 Sydney property market was punctuated by significant consumer confusion of property valuations, which appeared to create a reluctance to bid at some auctions. Real Estate agents openly were underquoting guide prices in a weird and heavily flawed strategy to fill out auction events. One of the best examples of this was an auction I attended at West Pymble where the agent proudly spouted that they had received the largest number of registered bidders ever. Yet, come bidding time, only three parties actively bid. The rest looked on with glazed eyes, having been eliminated from bidding in the auction’s first round where the property opened close to what was its comparable location supported price valuation. I can’t stress enough how important it is when buying property to understand the most recent comparable sales prices in the area in which you are looking to buy and to not use Real Estate agent guide prices as anything other than an indication of what the property won’t be sold for.

At MCS Buyers, we hang our hat on not only being across the sales data before considering attending an auction but entering all sales with a strategy to ensure we buy well or move our attention to an alternate property. Buying property within the correct market pricing range is paramount, especially when using mortgage funds, as you never want to exceed the bank valuation, which could see you having to cover a shortfall in capital at the time of settlement. For self-represented buyers, events like the West Pymble auction represent a significant waste of time, loss of confidence, budget and affordability confusion, and ultimately the risk of FOMO driving them potentially toward a poor future purchase decision driven by desperation.


As 2023 moved its way through November, the Sydney Real Estate market continued to swing more in the direction of a buyer’s market with an ever-increasing number of properties listed for Auction being negotiated and exchanged before Auction day as agents persuaded sellers to meet the market.


Then came the November 7th RBA meeting and 25 basis point raising of Interest rates. “Drop in the sound of car tyres screeching to a halt on a busy road.”


The news did not get a good reception, and the Sydney Property market responded accordingly and immediately. I suggest the reasons for the sudden and immediate line in the sand were the result of various factors which, taken in the context of what had been a relatively and unexpectedly strong 2023 Property Market, will pass, and we expect a return to confidence in 2024.


From our position as Buyers Agents, the November market was showing signs of exhaustion; the threat of an interest rate rise had been hovering for months, and the general lack of respect for the RBA and its tarnished track record of the past few years resulted in a universal two-finger salute, and the market stalled. November and December are the busiest months of the year for most Australian workers, and with a Christmas/summer break on the horizon, I feel buyers called timeout from property purchase for 2023.

“We expect activity in the Sydney Property market to build from late January as buyers with their eye further down the road take advantage of the flat market at the end of 2023.”

2024 is shaping up to be a transitional year for inflation, where we move from the fear and loathing of out-of-control inflation to a normalising position and an end to the interest rate rises. Regrettably for Australia, this is likely to play out first in the northern hemisphere, where all eyes are on the US reserve and the actions they take. When the USA starts their interest rate reduction cycle, it is doubtful Australia will be in any rush to follow. Our reserve has resisted acting hand in glove with the USA on the increasing cycle, which leaves the USA in a position to make a number of decreases before the Australian reserve needs to act.

The positive for Australians is that we may see an improvement in the AU$/US$ exchange rate over the short term as the spread between interest rates grows in our favour, although Australian borrowers may have to suffer through the first half of the year under the current elevated interest rates.

Which brings me back to our view on the 2024 Sydney property market. “We expect activity in the Sydney Property market to rebuild from late January as buyers with their eye further down the road take advantage of the flat market at the end of 2023.” Once the US reserve pulls the trigger on an interest rate reduction, we see a line in the sand being drawn, and expect savvy Real Estate buyers will shift their focus back to bricks and mortar investment and the growth that comes from a fairer lending environment.

It’s important to remain realistic about future interest rates and not view the unprecedented deep cuts experienced during COVID as anything other than an emergency measure. The world was potentially in deep trouble when COVID hit, and governments around the world reacted with massive stimulative actions. To be honest, I hope we never see ourselves in that position again as it’s a sure sign that bad things are happening. We would hope over the course of the next 18 months and in an environment of relative global stability, Australia will return to a normalising bias, which in our view would be a basic variable home loan around the 5.5% interest rate.

The REA group notes in their recently published PropTrack 2024 Property Price Forecast, that “interest rates are very high, and affordability is still very strained, so that’s going to be a headwind on prices. However, this is expected to be offset by tailwinds including strong population growth, strong wages growth, or increasingly strong wages, as well as low unemployment.” I would add constraints in the current supply of housing, the long lead time in which more stock will come to market, and the potential lower quality areas in which development can occur to scale up supply will continue to be a driver of pricing of quality locations throughout Sydney as the scarcity rule plays out.

At MCS Buyers, our approach to Sydney property is unchanged. Be informed, be across the market, don’t rely on Real Estate Sales Agents for information, buy scarcity, buy the opportunity to add value above market and approach all Sydney property, most notably your principal place of residence, as the most important investment-grade asset in your financial portfolio.

Before you venture out to commence your Sydney property search, please first give us a call at MCS Buyers and take advantage of an obligation-free chat over coffee to understand the value and expertise we bring to buying quality property in Sydney.

Important Note: The above article is not intended as financial advice and readers should conduct their own research on market and interest rate trends and general domestic and global financial markets. It is strongly advised that anyone looking to buy property should first seek professional financial advice from a licensed accountant, financial planner, and mortgage broker to review their individual financial circumstances and capabilities.