Parramatta Market Outlook

MARKET OUTLOOK PARRAMATTA

Parramatta is Sydney’s second CBD and is benefiting from multi-billion infrastructure projects that are improving transport

Top: Parramatta River; Left: Westfield Parramatta; Right: Parramatta Train Station

LOCATION & ACCESSIBILITY

Parramatta is strategically located at the geographic heart of Sydney, around 23 km west of the Sydney CBD. The Parramatta CBD has been designated as Sydney’s second CBD and is recording significant development to service the growing Western Sydney region. Parramatta is well connected by public transport, with the Parramatta Train Station providing residents with direct access to the Sydney CBD and throughout Sydney. Parramatta River ferry services connect Parramatta to Darling Harbour and Circular Quay. Public transport will continue to improve with the Parramatta Light Rail and Sydney Metro West currently under construction.

There is an extensive network of public and private schools in the area, including Parramatta East and West Public School, Parramatta High School, Arthur Phillip High School, Macarthur Girls High School and Parramatta Marist High School, to name a few. New schools are also being opened regularly to meet the demand of new families living in the area. Tertiary education options are accessible to residents, with Western Sydney University and the University of Sydney (both ranked in the top 2% of universities in the world) having campuses in the area.

The state-of-the-art Westmead Health Precinct is located 2km away and is one of the largest health, education, and research precincts in Australia. Comprised of four hospitals, two universities, two research institutions and many allied health services, residents are provided with high-quality specialised healthcare and employment opportunities.

Parramatta is home to several retail activity centres including Westfield Parramatta, one of the largest shopping centres in Australia featuring over 450 stores. The centre is anchored by David Jones, Myer, Kmart, Target, Coles and Woolworths and also features several entertainment options for residents.

Residents of Parramatta have access to extensive open space and outdoor recreation facilities that support an active outdoor lifestyle. Situated along the Paramatta River, the vast Parramatta Park offers opportunities to exercise, socialise, and is also a venue for major events. These large open spaces are complimented by smaller neighbourhood parks and reserves, Commbank Stadium and Rosehill Garden Racecourse.

RETAIL

01. Westfield Parramatta

02. Parramall Shopping Centre

03. Greenway Plaza

04. Harris Park Shopping Precinct

EDUCATION

05. Parramatta Public School

06. Harris Park Public School

07. Parramatta High School

08. Parramatta Marist High School

10. Arthur Phillip High School

11. Macarthur Girls High School

12. The King’ School

13. Western Sydney University

- Paramatta CBD

14. Western Sydney University

- Rydalmere

15. Western Sydney University

- Westmead

16. The University of Sydney –Westmead Clinical School

09. Mother Teresa Primary School

Harris Park

Westmead

41.

Parramatta

Parramatta

INFRASTRUCTURE & EMPLOYMENT

INFRASTRUCTURE

SYDNEY METRO WEST

Estimated Completion:

2030 - Over $18 billion

The proposed Parramatta Metro station is part of the Sydney Metro West project, increasing the speed and capacity of travel between Parramatta and the Sydney CBD.

PARRAMATTA LIGHT RAIL

(Stage 1) 2024 - $2.9 billion

Stage 1 is set to connect Westmead to Carlingford via Parramatta CBD. The proposed Stage 2 is set to connect Stage 1 at Camellia to Sydney Olympic Park via Melrose Park.

PARRAMATTA SQUARE

Completed:

2022 - $2.7 billion

Parramatta Square is one of NSW’s largest urban renewal precincts, comprising six commercial office buildings, a refurbished town hall and library, dining and 6,000 square metres of public space.

POWERHOUSE PRECINCT & MUSEUM

2024 - $840 million

The Powerhouse Precinct development is proposed to deliver around 18,000 sq.m of public space and a new Museum of Arts and Applied Sciences on the Parramatta River foreshore.

RIVERSIDE THEATRE REDEVELOPMENT

Estimated Completion: 2026 - $136 million

The proposed redevelopment is anticipated to more than double the Theatre’s capacity. The new theatre is set to include a 1,4000seat Lyric Theatre and a 430-seat Black Box performance theatre

TOP 5 INDUSTRIES OF EMPLOYMENT

Parramatta residents will benefit from ongoing infrastructure investment which will improve connectivity, civic spaces, education and create more employment opportunities.

EMPLOYMENT

For the purpose of this profile, the Parramatta Study Area has been defined as the suburb of Parramatta. The Parramatta CBD is the commercial and cultural epicentre of Western Sydney and caters to a growing number of government agencies and corporations. This growing business presence has led to increased residential demand from the large number of whitecollar professionals working in the area.

The Parramatta CBD is growing rapidly as Sydney’s second CBD. The newly developed Parramatta Square encompasses a big part of this recent growth and is home to NSW Government agencies including; National Australia Bank, and Indesco.

Employment in Parramatta CBD grew by approximately 30,000 new jobs over five years from 2016 to 2021. The Parramatta CBD is poised for significant job growth of almost 13,000 new jobs between 2024 and 2039.

Other surrounding employment centres include Macquarie Park and Rosehill. Rosehill forms part of the broader Camellia-Rosehill growth precinct, which is proposed to include an urban services precinct with an emphasis on circular economy industries.

In 2024, approximately 40% of resident workers in the Parramatta suburb were employed in the Health Care and Social Assistance and Financial and Insurance Services sectors. The Professional, Scientific and Technical Services, Public Administration and Safety and Education and Training Services sectors accounted for a further 30% of total resident employment. Over the next 15 years, these five industries are anticipated to deliver over 9,000 jobs in Parramatta.

Ongoing investment in and around surrounding employment centres will drive further job opportunities, making Parramatta an attractive place to live.

Source Transport for NSW; Prepared by Urbis

Parramatta

Sydney Olympic Park

Macquarie Park

Rosehill

Westmead

POPULATION & DEMOGRAPHICS

POPULATION

Over the next 15 years, the Parramatta Study Area is anticipated to grow by approximately 36,450 new residents, increasing by 5.3% per annum from 2024 to 2039.

This is significantly higher than the 1.1% per annum forecast for Greater Sydney over this period. Persistent forecasted growth is attributed to ongoing infrastructure projects and the reopening of borders to international migration after the COVID-19 pandemic.

Study

Source: ABS Census 2021; Transport for NSW; Prepared by Urbis

Study

Source: ABS Census; Prepared by Urbis

Parramatta is recording robust population growth characterised by attracting ambitious young and multicultural residents looking to rent in a highly connected area.

DEMOGRAPHIC

Parramatta is characterised by a high proportion of white-collar professionals and couple families with no children, typically living in rented apartments. In addition, there is a relatively high proportion of residents attending tertiary education institutions due to the presence of Western Sydney University’s campuses as well as several other tertiary institutions in the area. These demographic attributes, coupled with steady population growth, are expected to drive demand in the high-density residential market moving forward.

With 45% of residents aged between 25-39 years, the area is primarily characterised by couples without children (40%). These residents are looking to live close to employment opportunities and amenities and are willing to rent.

Parramatta is attracting more aspirational people, with the average household income increasing by 4.8% per annum over the last ten years to $108,784 in 2021. The average household income in the region has grown faster than the Greater Sydney average, which recorded 3.7% per annum between 2011 and 2021.

Parramatta is a diverse and multicultural area, with three-quarters of the population born overseas. The top three countries of origin are India, China and the Philippines.

WHO LIVES IN PARRAMATTA (2021)?

Source: ABS Census 2021; Prepared by Urbis

RESIDENTIAL ANALYSIS

The Parramatta Study Area has recorded strong capital growth in median unit prices over the last ten years averaging 2.0% per annum to December 2023. Prices recorded strong growth from 2013 to 2017 before declining in 2018 and 2019, in line with the broader Sydney market downturn. In the past four years, prices have stabilised, reflecting Parramatta’s resilience to the impacts of COVID-19 and consistent demand for an attractive location in Sydney’s second CBD.

In 2023, median apartment prices reached $620,000 across 810 transactions. Parramatta’s apartment price remains more affordable than the Sydney average of $757,000. The median unit price to household income ratio of 5.7 in the area is substantially lower than the Greater Sydney ratio of 7.0, which will continue to be an important driver of housing demand.

In the 2021 Census, apartments accounted for 75% of dwellings in the Parramatta Study Area compared to 28% in Greater Sydney, reflecting the increased density of development in the area. Given the substantial infrastructure investment, employment growth along with the demographic attributes of residents in Parramatta, it is expected to remain a popular location for apartment development. This is reflected in the significant development pipeline in the Study Area of approximately 6,500 units.

Semi- detached Flat, Unit or Apartment

Parramatta has experienced strong growth in median unit prices over the past ten years and offers strong affordability.

Source: PriceFinder; Urbis

PIPELINE as at March 2024 Source: Cordell Connect; Urbis Essentials

RENTAL ANALYSIS

The strength of the Parramatta rental market is highlighted by its indicative gross rental yield of 5.0% for units in the year to November 2023. This is significantly higher than the Sydney average of 4.3%.

Parramatta remains popular among young professional couples and students due to its proximity to employment nodes, tertiary education facilities, retail, and public transport. These segments have historically driven rental demand in the region.

According to the NSW Department of Communities and Justice, the median weekly rent for two-bedroom units in Parramatta was $640 in December 2023, lower than the Sydney average of $700. Rents in the region declined during the pandemic as Parramatta has historically attracted many international migrants and students. The reopening of Australia’s border to migrants and students has been a critical boost to rental demand, with rent increasing by 15% since December 2020.

As at January 2024, Parramatta (2150) recorded a significantly low residential vacancy rate of just 1.0%, relative to the Greater Sydney average of 1.3%. Coupled with a strong rental yield, Parramatta’s rental apartment market is primed for further growth, a positive for potential investors.

GROSS UNIT RENTAL YIELDS

12 months leading to November 2023

Parramatta is one of the most attractive rental markets in Sydney with almost three quarters of households renting.

MEDIAN WEEKLY RENT FOR 2 BEDROOM UNITS

December 2018 – December 2023

Source: NSW Department of Housing Rent Data; Urbis

RESIDENTIAL VACANCY RATE

January 2024

Source: Pricefinder; Urbis

SUMMARY

Urbis has investigated the trends that will deliver a sustainable residential market comprising of sustained and confident growth now and into the future. This involves recognising the key fundamentals that investors seek to secure returns, as well as identifying regions that will be the most desirable to live, work and play. Urbis has concluded that the most desirable locations are those that deliver “P.I.E” – Population, Investment and Employment growth

P – Population Growth

Parramatta is projected to grow by an additional 36,452 new residents by 2039, growing at a fast rate of 5.3% per annum and well above that of Greater Sydney. New residents are attracted by the transport connectivity, access to employment opportunities, education institutions, retail amenity and open space.

I – Investment & Infrastructure

The region has benefitted from significant infrastructure projects across transport, education, health, and recreation in recent years. This investment will continue with around $30 billion to be investment into Parramatta across major projects including Sydney Metro west, Parramatta Light Rail, Powerhouse Museum, Parramatta Aquatic and Leisure Centre, Paramatta Riverside Theatre and Parramatta Quay & Charles Street Square Upgrade.

E – Employment Opportunities

Proximity to employment nodes and centres is essential for residential growth. New jobs lead to new residents as people seek to minimise travel times and improve work/life balance. With Parramatta’s strategic location, residents are surrounded by several growing employment centres including Parramatta CBD, Sydney Olympic Park, Macquarie Park and the Westmead Health Precinct.

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