SYDNEY BOOM TIMES & PLAYING CATCH UP

Mr Triguboff, the managing director of Meriton Apartments, is Australia’s biggest residential developer – laying claim to building more than 50,000 houses & units since establishing the company in 1963. “For many years, we have underbuilt in Sydney. So now we are catching up to pent-up demand,” Boomtown: Sydney Cranes crowd the Sydney skyline

It is interesting to compare the Sydney of today to that of 50 years ago. In 1964 Sydney was doing very well, Australia was experiencing what was to prove a decade of strong growth, low inflation, and low unemployment. The global economy was strong and Australia was experiencing an influx of new migrants (mostly British/Irish), as the “Bring out the Briton” scheme saw an influx of “10 pound poms”, and Sydney’s population hits 2.2M.

Sydney’s Australia Square was rising out of the ground, towering above everything else, and en route to 45 stories. The Sydney Opera House was in the midpoint of its construction. The Gladesville bridge was opened in 1964, and plans were afoot for a new international terminal at Sydney airport which was starting to cater for large jets.

Sydney roads were now free of trams, with the last tramlines having been closed in the early 60s. The sunken section of the Cahill expressway had just opened, as Sydney embraced the car. In 1964 the Paddington Society was established as residents feared “big developers” .

Fast forward to 2014, and Sydney’s population is now 4.57M, and immigration is strong albeit with a different mix to 1964. The official interest rate is at a record low of 2.5% and fixed mortgage rates are below 5%. Sydney’s median house price has posted a 17% rise in the 12 months to June, to hit a new record of $812,000, while Sydney units rose 13.3%.

Unemployment is low, and both the local and global economy remain buoyant. Construction has sprung to life with various projects, most notably Barangaroo full-steam ahead. Sydney’s light-rail project is expanding, as Sydney re-opens some tram corridors. Sydney’s second airport has been confirmed for Badgery’s creek and Sydney has a new 82 story residential tower rising, albeit without various floor numbers that don’t work well in Mandarin Chinese.

So it’s interesting that while some capital cities have languished, Sydney has continued to surge ahead, fuelled by a steady influx of migrants, eager to embrace Australia. This combination of favourable demographics and low interest rates, seems set to underpin continued strong growth.

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