By Alex Stuart | 7 Sep 2018

Sydney Apartment sales have continued to slow in Q2, according to Urbis’ latest Sydney Apartment Essentials report.

The report, which monitors 200 apartment developments across Sydney’s inner to middle ring, logged a survey response rate of 20 projects. From this, 44 sales were recorded of a total of 1,154 new apartments on the market in Q2.

Despite the slowdown, developers are still showing confidence with 1,150 new apartments, across five developments, launched in Sydney during the June Quarter. Nine projects comprising 1,500 apartments began construction during the quarter and a further 28 projects were settled.

Alex Stuart, Associate Director Property Economics and Research, said, “Barangaroo South is front of mind with registrations opening for its 71-storey tower, One Sydney Harbour. We expect this high-profile project to launch later in the year, showcasing its 360 premium apartments to global investors.”

Owner occupiers were the most active buyer type in Q2, accountable for 59% of all sales. Meanwhile foreign investors accounted for 28% of sales in the quarter. With bigger, city shaping projects on the horizon, we can expect to see a continued increase in overseas purchasers in the market for unique prestige product.

Two-bedroom, two-bathroom apartments continue to be the most popular product, accounting for 45% of units within actively selling developments. The Lower North Shore precinct has seen a spike in the number of studio products, with 12% of future supply flagged as this product type.

We expect to see smaller apartment development releases as apartment approvals continue to decline, down to eight project approvals in the quarter (totalling 289 apartments) from 12 approvals for 2,247 apartments in Q1 2018.

The Parramatta region currently has the largest future supply with over 4,500 apartments approved and a further 4,370 currently selling. Inner South Sydney is following closely with 3,500 apartments approved for the precinct and an additional 2,764 actively selling during the quarter.

Two developments were flagged for launch in the next quarter with a total of 408 apartments, adding to the existing 13,000 apartments currently on the market.

Mr Stuart noted, “The weighted average sale price has stayed relatively stable at $1,147,000, though it is noted that this is based on a smaller sample size. However, continued moderation of project approval and launches, coupled with an increasing population, may place upward pressure on process.”