“Sydney property, on average, doubles in value every 7-10 years.”
That’s the cry of every property spruiker nationwide. And inevitably the response - “how can that be with the average price in Sydney where it is today, how can the average house be worth a million dollars?”, or more perhaps after the last bump.
Before I answer that I want to ask you to think about your grand parents, what they paid for their home & when. Do you think they ever imagined house prices could be what they are today?
My Nanna had the most amazing Californian Bungalow in Wahroonga, old blue stone and sandstone and grounds full of camellias and agapanthus, an old fashioned washing line with a timber frame and a chain to tilt the angle. Beautiful; camellias are still one of my favourite plants.
The home was sold in 1998 when my Nanna moved into a nursing home – I don’t know what they paid for the home originally, I wish I did, I’m sure it was under $1,000 pounds.
What is interesting is the sale price in 1998, 18 years ago (so 2-3 cycles) was $321,000.
In 1998 that was a lot of money – it’s a really lovely home – but I can’t imagine anyone at that time thought it would be worth closer to $1.4m 18 years later.
It’s a perfect example.
If you travel back on the timeline then in theory in 2005 – 2008 it would have been worth $622,000 which with the benefit of hindsight seems very reasonable although I am sure at the time it was an astounding price and the talk (particularly as we are circling the timing of the Global Financial crisis) was all about how Sydney homes were over inflated and the ‘bubble’ was ready to burst.
The home has not changed hands since my Nanna sold it but thanks to the internet today, I can research quickly and easily what a similar home would sell for right now and the figure is, as I mentioned, around $1,400,000 which is right on par for the theory, and there’s no reason at all to imagine that this is where it ends. So my friends while there are NO guarantees it’s a law of averages based on facts, not fantasy.
see full article here in the Western Weekender here : https://issuu.com/weekenderpenrith/docs/propertymarch31/26