Where is the Sydney market heading in the remainder of 2014?
You may not have a crystal ball, but that doesn't mean you aren't trying to look into the future before you buy investment property in Sydney.
So what does the rest of the year hold for the New South Wales capital? Overall, the property frenzy that was underway during the end of 2013 and early this year appears to be leveling off.
This makes perfect sense, as surging home prices and extremely high auction clearance rates are only sustainable for so long.
Price increases slow down
The return to normalcy was seen in the latest RP Data - Rismark Home Value Index release, which showed capital city price growth slowed down during April.
"The reduction in the rate of capital gains across the combined capital cities housing market brings growth back into a more sustainable range and will be a welcome relief for first home buyers," RP Data's Tim Lawless said.
"A lower rate of capital gains in Sydney and Melbourne where dwelling values surged 22.5 per cent and 16.4 per cent, respectively, over the current growth cycle, may now signal that these markets are moving through their growth cycle peak. However, we will need to see a few more months of data before we can establish whether a slowing trend is now evident in these cities."
Mr Lawless went on to highlight that Sydney had seen a reduction in auction clearance rates recently.
However, a less frantic housing market shouldn't be confused with a downturn in activity.
Homes are still selling quickly, and there's no denying that it's property owners who are in the best position in Sydney at the moment. At the same time, with sellers able to count on a good return in the market, more vendors will likely be putting their homes up for sale, which will benefit buyers hungry for more inventory to choose from.
Additionally, recent data shows that confidence in the NSW property market is higher than anywhere else in the country at the moment.
Confidence remains high
The Property Council/ANZ Property Industry Confidence Survey shows that the NSW confidence index has reached 140 for the June quarter, 40 points above the neutral level. These results are based on responses from nearly 2,500 professionals in the property and construction sectors throughout the country.
"The NSW property industry is enjoying a real moment in the sun," Property Council NSW Executive Director Glenn Byres said.
"It now leads all other states and territories on sentiment - and is helping to turbo-charge the state economy. Forecasts about increased staffing levels have hit record highs, fuelled by positive expectations on construction activity across all asset classes but particularly residential."
And if NSW is the current king of real estate confidence in Australia, Sydney is its crown jewel.
ANZ Head of Property Research Paul Braddick attributed the state's sharp increase in confidence over the past 18 months to the cyclical upswing in Sydney's residential property market, as well as a positive outlook for increased residential construction.
So what does this tell us about what's in store for the rest of the year?
Growth remains on the horizon
Investors and traditional home buyers alike have plenty to smile about, as growth in the Sydney property market is set to continue throughout the rest of 2014, albeit at a slower, more manageable pace.
Whether you're considering investing in a rental property in the inner west or want to buy a family home in the eastern suburbs, the key is working with professionals who can help you understand the region and where it's heading.
Sydney real estate may be valuable, but the right buyers agent in Sydney could be just as beneficial.