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HOUSE prices in all areas have surged in recent months but, they seem to be slowing down, in spite of lower interest rates.
However, Sydney prices keep going up and the Home Price Guide says the median price for houses across Sydney over the past 12 months has risen from $334,000 to $355,000 (6.3 per cent), with medians in many inner-city suburbs rising dramatically.
Consider Surry Hills at 15.2 per cent and Randwick at 8.1 per cent.
The main reason is confident buyers swamping the market encouraged by consistently low interest rates.
Other factors are expats taking advantage of the low Australian dollar, and the State and Federal governments' first home buyers' schemes.
City and East
John McGrath of McGrath Residential says prices for renovated houses in the east now start at $600,000.
"For semi cottages, and they're one of the strongest sections of the market, properties that were selling a few years ago for $450,000 are now starting at $600,000-$650,000," says Mr McGrath.
"Even a little Paddington two-bedroom terrace is going for $600,000 to $650,000, without any parking."
He is predicting a strong market until the end of the financial year (end June) by which time he expects "some changes".
Mr McGrath then expects the market will "probably settle into a reasonable plateau for a few years to come, then something will drive it up".
He says 12 years ago prices doubled in 18 months whereas "this time round we've seen properties going up 60 to 70 per cent in four to five years".
Michael Dunn, the director of Richardson and Wrench in Double Bay, says his own prediction is that we've seen the best of the market and that buyer confidence may dissipate.
"It's my belief that the inevitable rise in the Australian dollar will temper the interest by overseas buyers and that will have a flow-on effect resulting in a fall in confidence in the local market."
He's also tipping prices to "plateau".
"I don't anticipate a dramatic effect, but a slowing in demand - not the end of the world - but back to a more moderate level market when the buyers and the sellers are on a level playing field."
North
Mosman agent David O'Gorman, of O'Gorman and Mahon, says there are properties available but they're overpriced: "No-one's going to part with an extra million dollars if they don't have to."
Despite the high prices - and he says they've jumped 20 per cent in 12 months and nearly 100 per cent in four years - he doubts they're heading for a crash.
"I firmly believe that we won't see a 100 per cent increase on today's prices in four years - they'll probably plateau. But interest rates are low so therefore we won't get another crash."
Northern beaches agent Jason Martin, director of Century 21 in Dee Why, says: "Demand is outstripping supply about tenfold, putting a real squeeze on prices."
South
Cristine Castle, director of Nationwide Realty in Oatley, describes the southern suburbs as "rock solid".
She says buyers can usually find a quality full brick three or four bedroom home for $600,000 to $650,000 in Oatley with a pool on a 600-700 square metre block.
In Menai, Scott Gibbins, of Century 21, says he has three bedroom brick veneer homes on big blocks with a garage from $350,000 on his books, as well as $500,000 to $800,000 homes overlooking the Woronora or Georges river.
Inner West
Sebastian Bonaccorso, the principal of Elders in Enfield, says entry level prices in his area start around the $400,000 mark for weatherboard semi or $550,000 to $600,000 for a three bedroom freestanding bungalow.
But prices are skyrocketing.
West
Penrith agent John Burgoyne, principal of RE/MAX, says: "Stock priced between $200,000 and $250,000 is very patchy and there's not a terrific amount in the market from $300,000 to $375,000 either."
He says entry level buyers will pay $225,000 to $300,000 in south Penrith for a three-bedroom brick veneer home with a garage. At the other end of the scale, four bedroom homes at Glenmore Park with a rumpus/family room and pool cost $475,000.