An ordinary suburban house surged in value by $1million in just five months.
The home at Marsfield in Sydney’s north-west was sold for $1.76million in November last year.
But on Saturday it sold for $2.74million – a 56 per cent increase in just five months with the new owner set to knock down the old house, built in 1960, and replace it with duplex on the 923 square-metre block.
That is even more dramatic that the 11 per cent rise in Sydney’s median house price between November and March, which took mid-point values to a record $1.112million, CoreLogic data showed.
Belle Property Ryde principal Phillip Allison said the seller was a developer who had obtained council permission to build a five-bedroom duplex.
An ordinary suburban house surged in value by $1million in just five months. The home at Marsfield in Sydney’s north-west was sold for $1.76million in November last year. But on Saturday it sold for $2.74million – a 56 per cent increase in just five months
In a hot market, the new owner outbid developers and plans to live on one side of the new duplex and rent out the other side.
‘Typically, it’s just been developers, now the home owners are looking at the duplexes as really good options for them,’ Mr Allison told Daily Mail Australia.
‘This is the best I’ve seen it in over ten years, absolute best.’
Ryde council, before the auction, had given approval to Julie Holding for the house to be knocked down and replaced with a duplex, leading to 13 registered bidders actively competing on Saturday morning.
The existing four-bedroom, two-bathroom house at Marsfield surged in value by $980,000 even though it is near Macquarie University, which has lost international students as a result of Australia’s border being closed to non-residents.
The soaring price showed buyers are eyeing homes with a backyard in middle-distance suburbs of Australia’s big cities, and not just houses in very desirable locations by the beach.
Apartment prices in the nearby North Ryde and Macquarie Park area, however, aren’t rising much in value with oversupply an issue.
‘Units aren’t performing anywhere near as well as the houses and the duplexes,’ Mr Allison said.
Belle Property Ryde principal Phillip Allison, the selling agent, said the seller was a developer who obtained council permission to build a duplex. Pictured are approved council plans
‘There are a lot of units that have been built over the last couple of years stretching anywhere from Meadowbank to through to Top Ryde and then through to Macquarie University area heading up towards North Ryde – there are a lot of those on the market at the moment.’
Sydney’s weekend auction clearance rate surged to 84.8 per cent, CoreLogic revealed.
Janus Henderson Investors head of fixed interest Jay Sivapalan said Australian house prices were likely to surge by 15 per cent in 2021 but growth would slow to between five and 10 per cent next year as the banks started raising their variable mortgage rates.
‘The outcome will be a slowing down – the rising of house prices – as opposed to a fall in house prices,’ he told Daily Mail Australia.
The four-bedroom, two-bathroom house at Marsfield surged in value by $980,000 even though it is near Macquarie University, which has lost international students as a result of Australia’s border being closed to non-residents
‘Over a one, two, three-year period, Australian house prices will hold very well.’
Mr Sivapalan said the Australian Prudential Regulation Authority was likely to impose stricter rules of deposits to get a home loan in a bid to cool an overheating market.
‘The pace at which house prices rise should start gradually moderating,’ he said.
From July, the banks will no longer be able to access $90billion in funding from the Reserve Bank of Australia to provide cheap home mortgages and small businesses loans.
Apartment prices in the nearby North Ryde and Macquarie Park area, however, aren’t rising much in value with oversupply an issue. Pictured is an apartment tower at Macquarie Park
The Term Funding Facility was introduced in March last year as Covid shutdowns sparked Australia’s worst quarterly economic downturn since the 1930s Great Depression.
This means the big banks will have to start sourcing more of their funds to lend out from either deposits or the wholesale money market.
Mr Allison is also expecting a slowdown in house price growth.
‘There could be a shift around that time,’ he said.
The Reserve Bank of Australia was expected to keep its promised to hold the cash rate at a record low of 0.1 per cent until 2024.
Three of Australia’s big four banks are still offering fixed rate of less than 2 per cent.