Theresa Worrell: Sydney Housing Market Update [video]

The pace of capital gains remains national leading across Sydney with housing values rising a further 2.6% in June, taking the typical value of a Sydney dwelling 15% higher over the financial year.

House values are up 19.3% over the year, compared with a much softer 5.1% lift in unit values.

Such a significant surge in house values has pushed the median to just over $1.2 million.

With affordability pressures mounting, it’s reasonable to assume housing demand will be deflected back towards the medium to high-density sector where values are substantially lower.

The difference between Sydney’s median house and unit values has never been this wide, at a bit over $430,000.

There are some signs that some steam is coming out of the market though.

Monthly growth in dwelling values has eased back from 3.7% in March earlier this year to 2.6% in June.

Clearance rates have reduced from the mid 80% range to 70% range and new listing numbers are tracking about 24% above the five-year average, which should help to gradually lift advertised inventory levels if buyer activity slows.