Where is the best buying in the Inner West right now?

The property market in Sydney has softened which leaves the question, 'where is the best buying in the Inner West right now?'

I have analysed the auction clearance rates over the last 5 months or so across 34 suburbs in the Inner West. I have also analysed over 3,000 properties across the Inner West for their price guide and sale outcomes. This data combined gives me a good grip on the types of properties that are selling well vs. lagging, and the areas that offer the most negotiation power vs. still competitive.

Auction clearance rates overview

Back in late February, the Inner West was running at 84% clearance. That's a very strong market where nearly every property is selling prior to or at auction. Over the next 5 months or so, we can see the auction clearance rate slowly deteriorate, and since mid-May we've been sitting consistently below 64%, with the last two weeks of June sitting circa 54%. The six-week rolling average of 60% is considered a balanced market. Below 60% clearance is where buyers generally have more bargaining power. However, if vendors are not willing to meet the market, these properties might be withdrawn from sale altogether.

The 5 suburbs worth watching closely right now

Using the suburbs with reliable data i.e. an auction sample size large enough to be meaningful, here are my top 5 suburbs and property types based on the data.

Marrickville houses
55% clearance across 89 auctions which is the largest sample in the dataset. With a $2.30M median and guides typically running about 10% below where things actually sell, there are generally expectations at or near the guide price. The biggest leverage is in the 4-bedroom segment where the clearance rate sits at just 46%, meaning buyers have a better chance at nabbing an excellent price for larger Marrickville houses.

Ashfield houses
59% clearance across 41 auctions, $1.98M median making Ashfield one of the most affordable of the house suburbs in my dataset. If you have a house budget sub $2M in the Inner West, Ashfield is one of your best options right now. Again, we see that larger houses offer the biggest negotiating power, with 4-bedroom house auction clearance rates sitting at just 36%.

Erskineville apartments
59% clearance across 44 auctions, $1.17M median. One of very few inner west apartment segments running below 60% clearance right now. 2-bed units sit around a 56% clearance rate, meaning buyers have more chance of negotiating a great price or facing less competition in Erksineville unit market compared to other suburbs in the Inner West.

Newtown houses
61% clearance across 67 auctions, $1.77M median. Houses here are roughly selling 5% above the agent's guide price. The trend continues with larger houses seeing the highest pass-in rate, with 4-bed houses cleared at just 44%. In a suburb that is popular in a hot market, buyers can take advantage of the slowdown in competition.

Five Dock houses
48% clearance across 25 auctions, $2.33M median. More than half of Five Dock houses that went to auction didn't sell, which is a signal that vendors can't rely on competitive bidding and buyers have more room to negotiate. In this data, there was a significant number of vendors pulling their properties before auction day rather than risk a public pass-in. Once again, 4-bedroom houses are under the most pressure with higher pass-in rates. Buyers looking at larger homes have the upper hand in this market.

Special mention: Drummoyne Apartments
42% clearance across 48 auctions, $1.23M median. On the numbers alone this is the strongest buyer signal in the entire dataset with more than half of every apartment passing in. The 3-bedroom pocket is even more pronounced at just 29% clearance. The reason it doesn't make my top five is a lifestyle one rather than a data one. Drummoyne doesn't have a train station, and lack amenities compared to the top 5 listed.

Note that the above analysis does not mean buyers will have great negotiating power in every scenario. There may fierce competition on a property, or even if not, the owner may not be willing to reduce their expectations and may hold onto their property. Sometimes these properties pass in, switch to for-sale, and then sell at a higher than expected price, because all it takes is one buyer to pay more for a property one week than the next. Use this data as a guide, not a guarantee. Happy sourcing!