While the Sydney apartment market rebounded in the second half of 2019, investor demand has remained subdued, according to the latest research from JLL.
Last year, 7,240 apartments were completed in Sydney, which represents a decrease of 31% compared to 2018.
"The number of apartments is expected to decline further over the next two years, with approximately 3,500 apartments to be completed annually in 2020 and 2021," said Leigh Warner, senior director and director of residential research at JLL Sydney.
The drop is expected to occur despite the increase in the number of approved projects during the fourth quarter of 2019. Warner has stated that these approved projects are likely to experience delays due to muted off-plan sales.
Read also: Where is the Sydney unit market going?
"The supply data showed that the number of apartments currently on the market has decreased by 54%, which means that the planned projects are still not generating enough interest or funding to move to the marketing and construction stages, "he said.
However, apartment prices in the city increased 3.4% year-over-year in the last month of 2019.
On the rental market, median rents continue to fall despite the decline in vacancy rates.
"Supply levels fell sharply in 2019, which will help rebalance the market quickly. However, even with a fall in supply, the recent price increase is expected to moderate as registrations in the existing market are increasing in the short term, "said Warner.
Top suburbs:
belmont
,
west wodonga
,
Toowong
,
rooted hill
,
Mayfield
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