The two most resilient property markets in Australia revealed

According to Herron Todd White director Shaun Thomas, both houses and lands in these regions were experiencing high levels of demand, with auction clearance rates at 80-plus per cent each week since the beginning of 2021.

“Prices for some market segments in some areas are also surpassing previous peaks.

“This is largely driven by low interest rates and snowballing fear of missing out of purchasers,” the director added.

Among the standout suburbs were Paddington, where a similar property that sold for $1.9 million during the market slumber in June 2020 went for a much higher $2.5 million in May 2021.

The beachside suburb of Malabar also saw positive results, where two similar properties sold between March and December 2020 saw a difference in price of over $1 million.

“It is quite common during periods of high price growth for buyers who have been priced out of
beachside suburbs further north, such as Coogee and Bondi, to look at more affordable options, and this appears to be what is happening in Malabar presently,” Mr Thomas said.

Other hotspots included Queens Park and Surry Hills, where prices have also increased significantly over the past year.

But while houses have recovered swiftly, units – particularly studios and one-bedroom units in average-quality complexes – have shown far more subdued recovery in the past six months, largely due to a significant decline in rental demand.

“Nowhere is this more evident than in the CBD where the tenant profile is commonly overseas contractors or students who are currently few and far between due to international border closures.

“This has led to increasing numbers of investors looking to sell and has caused an increase in the supply of available one-bedroom units.”

However, the prestige unit market seems to be going in an entirely different direction.

According to Mr Thomas, this market has been outperforming the rest of the unit market as downsizers, “cashed up from the sale of their family homes”, continue to drive demand.

Suburbs such as Bondi Beach, where units sell for as much as $20 million, are witnessing this trend in particular.

Overall, many buyers appear to be eager to get their foot into the inner city and eastern suburbs despite the fast-growing prices and increasing levels of competition, Mr Thomas said.

“The most surprising aspect of the 2021 inner city and eastern suburbs property markets has been the overall comfort purchasers seem to have in massively exceeding guide prices and offering above recent comparable sales.

“Entering 2021, there was significant uncertainty surrounding unemployment and upcoming JobKeeper and JobSeeker changes, but these concerns seem to have fallen away in the wake of the fear of missing out which is currently driving the market,” the director concluded.