In addition to revolutionising the city’s transport infrastructure, the impact of Sydney Metro on property values will be significant. The recent opening of the new City line has proven this, driving increased buyer enthusiasm around the new stations. Even properties in close proximity to established stations have seen a measurable impact on prices.
Acknowledging this, we wanted to take a closer look at the Sydney Metro property values phenomenon. As part of this, we will explore what the Sydney Metro is and how it is impacting key market metrics. We will also consider what this means for owners and buyers of, and investors in, properties located along the line.
What is the Sydney Metro?
Sydney Metro is being touted as Sydney’s biggest infrastructure project since the building of the Harbour Bridge. It represents a major overhaul of the city’s public transport system, increasing connectivity and significantly reducing commute times. It is also Australia’s most technologically advanced railway, and will be the country’s first fully accessible and driverless train network.
Once complete, this $70 billion project will join a network of 46 stations across 4 lines and 113km of track. It will also double network capacity, enabling trains to run under the CBD every 2 minutes.
The centrepiece of the network is the new City line, the first stage of which was opened in August. Currently connecting Tallawong in the North-West to Sydenham in the South-West, this line travels under the harbour and through the CBD. It also features 6 new stations – Waterloo, Gadigal, Martin Place, Barangaroo, Victoria Cross, and Crows Nest.
What impact is Sydney Metro having on property values?
While work on the Sydney Metro network is ongoing, commuters in upgraded areas are already starting to see the benefits. In Metro – Transforming Sydney Precincts, CBRE and PropTrack report that apartments in key Metro suburbs have noticeably outperformed their peers. Specifically, they identify a 5% increase in value growth over the last 10 years for suburbs located along the line.
Importantly, this was observed prior to the City line opening, with most experts believing this milestone would further accelerate growth. This is in addition to a range of other noteworthy impacts, including:
- Accessibility premium: Easy access to public transport, and particularly train stations, has long been a priority for both homeowners and investors. In Sydney, being within 400m of a train station has traditionally increased land values by an average of 4.5%. Early signs are that properties within close proximity to Metro stations are attracting a similar – if not greater – accessibility premium.
- Rental demand: Strong transport links are also valued by renters and a feature they are often willing to pay a premium for. As such, quality properties within walking distance of a train station tend to lease quicker and command higher rents. From what we are seeing, properties located near the recently opened new Metro stations are already seeing this increased demand.
- Increased commutability: Sydney Metro promises to significantly reduce travel times, particularly when commuting across the harbour or through the city. This makes living further out from the city a more viable option, even for those who commute regularly. As a result, interest in locations further along the Metro line is likely to increase as the network grows.
- Changing demographics: CBRE and PropTrack’s aforementioned report also noted that average 10-year population growth in near-Metro suburbs was 23%. This is roughly double the growth rate seen in the surrounding suburbs. It also reflects the higher density of these suburbs, with almost twice as many residents (approximately 50%) living in apartments.
- Urban Renewal: Population density around several key Metro stations is set to increase further, following zoning changes to allow larger-scale developments. The resulting additional investment will help attract new businesses and amenities to these areas, improving liveability and boosting property values.
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What does this mean for you?
If you are fortunate enough to own a near-Metro property, you are probably already well aware of its benefits. However, you may not be aware of the impact Sydney Metro has had on your property’s value. To get a clearer picture of this, we recommend engaging a local market expert to provide a detailed valuation.
If you are looking to buy near a Metro station, you should be aware of the premium you will pay. You may also wish to consider new opportunities created by the Metro and look at properties further along the line. Not only should you get more for your money further from the CBD, the capital growth potential should be larger.
If you are considering investing in property located near a Metro station, a long-term view is crucial. The greatest growth potential is found in the areas that have the most room for development and transformation. However, this kind of change takes time, so it will pay to be patient.
Also, not all station-adjacent properties are created equal, so it is paramount you do your due diligence. The type of property, exact location, and local development plans will significantly impact the returns you could achieve. As such, you need to consider these factors carefully and choose the opportunity that best fits your investment strategy.
Want to discuss this further?
If you would like more information on what Sydney Metro property values mean for you, contact Local Agency Co. Whether you are considering selling, looking to buy, or wanting to invest, we can talk you through your options.
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