2010 began with a strong set of expectations as to how the market would fair in following some fairly turbulent times over the past two years. The reality as we move into the tail end of the first quarter supports that expectation with solid clearances of over 70% at auction, a low number of days on market and a return of volume in the more expensive price ranges.

Investors and “up-graders” are taking the lead again following the removal of the First Home Owners Grant boost in October. With this renewed activity driven by low interest rates, population growth and a prediction that rents are expected to rise by an average of 5.8 per cent a year over the next three years in BIS Shrapnel's latest Residential Property Prospects (September 2009).

Having shaken off most of the concerns of the Global Financial Crisis, the country’s economy continues to show genuine signs of recovery in the New Year. The latest unemployment figures released by the ABS show a drop to just 5.3 per cent in January, down from 5.5 per cent in December, which makes it the lowest rate of unemployment since February 2009 all adding to the confidence needed for people to move forward with purchase decisions.

The Upper North Shore has been building momentum this year especially as profits and bonuses bounce back and confidence returns for purchasers and vendors alike. Australian Property Monitors economist Matthew Bell forecasts that “Top end properties will outperform in 2010, as they did in the second half of 2009, driven by rising wealth from the share market, lack of supply, and improved employment in finance, banking and IT.”

So how has the Ku-ring-gai faired over the past year and what is the outlook ahead? We look at the figures provided by the Australian Financial Review’s Prestige Property Price Guide to give you an overview of activity in the local area:

There are a number of factors that commentators believe will continue to affect the state of affairs as the year unfolds, namely further interest rate rises by the RBA which would see the official rate lift to more ‘neutral’ territory and have a cooling effect on the market.  Housing supply will also remain on the radar and whilst it is not a great thing for those trying to enter the market because competition amongst buyers can be quite intense, it does serve as a long term positive putting upward pressure on price.

If we rely on what we know of the residential housing market so far this year and BIS Shrapnel’s prediction (based on data from the Real Estate Institute) that average house prices in most capital cities will grow by between 11 and 19 per cent over the next three years, we can be comfortable that the first months of 2010 have provided us with some solid grounding for the year ahead.