Sydney Investment Guide CSIPROP2019

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INVESTING INTELLIGENTLY TOWARDS 2019/2020

CSIPROP INVESTMENT GUIDE

SYDNEY


Sydney Sydney’s housing market, historically the most expensive Down Under, has been hit the hardest by APRA’s regulatory measures. House prices had declined through 2018 alongside weakened investor demand, affecting construction activity and supply levels in the future. However, strong economic conditions, population growth and the NSW government’s expenditure into infrastructure will help moderate the slowdown. Prices are expected to stabilise in 2019 before picking up in 2020.

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New South Wales

Australia 3.1% 2.8% 1.6% 2.7%

State Final Demand Growth Over year to 4Q17

Retail Turnover Growth Over year to Mar 2018

Population Growth Over year to 3Q17

Employment Growth Over year to Apr 2018

3.0% 3.0% 1.6% 4.1%

NSW continues to boast a strong economy in spite of the slowdown in the housing market. Source: JLL, ABS

Hotspots Sydney’s eastern suburbs saw the lowest decline in demand as of July 2018. Suburbs like North Bondi sold quickly while Tamarama saw very high price increases. Freshwater, Paddington and Cammeray recorded the highest demand for houses while Fairlight, Cremorne Point and McMahons Point recorded high demand for apartments at the start of 3Q2018. The western suburbs of Sydney are showing some positives, with suburbs like Leppington, Parramatta and Blacktown listed on the HIA Hotspots Report as some of the Top 20 hotspots across Australia for building and population in 2018. The rate of population in these areas are faster than the national average and at least A$150m worth of residential building work was approved in 2016/17.

Of all the capital cities affected by tighter financing conditions and less investment activity in the property sector, Sydney is the hardest hit. Data shows that prices have dropped about 7.4% in the past 12 months. It’s not all gloom and doom: BIS Oxford Economics has predicted that Sydney will see a 3% price growth in the next 3 years. Low interest rates, the city’s relatively stable economic environment and population growth, as well as the state government’s A$15.3bn expenditure into infrastructure over 2018-19, could help in keeping the correction slight.

New South Wales

Research Report: Sydney

New South Wales Key Economic Indicators

Tighter financing conditions and less investment activity have had the most impact on Sydney’s housing market conditions. Source: Australian Property Market Report July 2018, realestate.com.au

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HIA National Top 20 Building & Population Hotpots 2018: Sydney

Statistical Area 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Mickleham - Yuroke Pimpama Cranbourne East Cobbitty - Leppington Riverstone - Marsden Park Wollert Docklands Beaconsfield - Officer Point Cook - East Truganina Melbourne Coomera Cranbourne West Melton South Tarneit South Brisbane Springfield Lakes Arncliffe - Bardwell Valley Southbank Homebush Bay - Silverwater

Statistical Area Level 4 Mickleham - North West Gold Coast Melbourne - South East Sydney - South West Sydney - Blacktown Melbourne - North East Melbourne - Inner Melbourne - South East Melbourne - West Melbourne - West Melbourne - Inner Gold Coast Melbourne - South East Melbourne - West Melbourne - West Brisbane Inner City Ipswich Sydney - Inner South West Melbourne - Inner Sydney Parramatta

State / Territory VIC QLD VIC NSW NSW VIC VIC VIC VIC VIC VIC QLD VIC VIC VIC QLD QLD NSW VIC NSW

Residential Building Annual Population Approved, Growth Rate (%) 2016/17($’000) 222,872 352,035 638,571 610,382 736,224 173,239 199,734 256,005 169,300 202,036 622,251 173,540 171,594 161,037 299,838 154,000 184,943 513,026 417,688 358,252

35.3 30.8 27.4 21.9 21.1 20.8 14.7 13.4 12.8 11.9 11.2 10.3 9.2 9.1 9.0 8.8 8.7 8.6 8.6 8.0

Four of Sydney’s suburbs made the HIA National Top 20 Building and Population Hotspots list in 2018. Source: HIA The inner west, western and northwestern corridors; as well as the outer northwest and outer southwest growth corridors also show potential for growth.

Quick Facts: Sydney . Strong job & population growth . Property prices expected to climb again in 2020-21 . Leppington, Parramatta, Blacktown & Arncliff ranked in Top 20 property hotspots

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Suburbs showing signs of gentrification are great for investment. Data from the Property Investment Professionals of Australia has identified the following suburbs for a makeover in the near future: • Arncliffe • St Peters • Tempe


Words VIVIENNE PAL

Research VIRATA THAIVASIGAMONY VIVIENNE PAL IAN CHOONG

Design & Layout AHMAD MUNAWAR ABD RAHIM JANE TAN

MARKETING AGENT (SINGAPORE) CS PROP Pte Ltd (E.A. License No. L3010808F | Co. Reg. No. 201731379K) Level 22, Tower B, Ngee Ann City, 391B Orchard Road, 238874 Singapore

MARKETING AGENT (MALAYSIA) CI PROPERTIES Sdn Bhd (E (1) 1797 | Co. Reg. No 1254857-K) Level 3, North Block, Wisma Selangor Dredging, 142D Jalan Ampang, 50450 Kuala Lumpur, Malaysia

+65 3163 8343 info@csiprop.com

+603 2162 2260 info@csiprop.com

PROJECT MANAGER CSI PROP Pte Ltd

@ 2019 CSI PROP Pte Ltd. First Edition. All rights reserved. This publication is the sole property of CSI PROP Pte Ltd (trademark: CSI PROP) and must not be copied, reproduced or transmitted in any form or by any means, either in whole or in part, without the prior written consent of CSI PROP Pte Ltd. All descriptions and other particulars are given in good faith and are believed to be correct but any intending readers, purchasers or tenants should not rely on them as statements or representations of fact and must satisfy themselves by inspection or otherwise as to the correctness of each of them. The Marketing Agents and the Project Manager shall be held responsible for any negligence, consequential loss or damage arising from the use of this information. No person in the employment of the Marketing Agents and the Project Manager has any authority to make or give any representation or warranty whatever in relation to these investments and properties. This is an overseas investment. As overseas investments carry additional, financial, regulatory and legal risks, investors are advised to do the necessary checks as well as research on the investment beforehand. Investors are also advised to seek independent and qualified legal, financial and tax advisors. Past performance is not necessarily indicative of future performance even if the same strategies are adopted.


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