An aerial photo of the Parramatta CBD, which has been branded a “danger” market for apartment buyers.

THE SYDNEY Olympic Park region, Parramatta CBD and airport precinct have become “danger” markets for buying apartments, a new report reveals.

The research claimed the price of units sold off-the-plan in these regions could drop in the near future, putting new buyers in danger of holding mortgages with a higher value than their properties.

Prices were tipped to drop on account of falling demand and rising housing supply, the Hotspotting.com.au report said.

Suburbs near Sydney Airport such as Mascot and Wolli Creek, along with Homebush, Breakfast Point, Sydney Olympic Park and the Parramatta CBD, have been at the centre of NSW’s recent construction boom and are among the areas with the longest pipeline of new housing developments in the country.

“Many of (these) markets will recover in time but right now they are all bad places to buy real estate,” the report said.

Parramatta has been among the first Sydney regions to show major signs of weakening, with the median unit price falling 3 per cent over the past year.

A new development in Sydney Olympic Park, one of the Sydney suburbs with the highest levels of new housing supply.

There has also been a drop in sales. Over 300 units were typically selling each quarter in Parramatta over 2013 and 2014 but less than half that number have been selling in recent quarters.

Homebush and Homebush West had similar falls in sales: the number of units sold over the recent quarter was nearly half 2013/14 levels.

Report author Terry Ryder said lower sales turnover was usually a precursor to further price falls.

This pattern was observed in Mascot, where the median unit price dropped 6.2 per cent over the past year after sales numbers fell from about 148 units per quarter in 2013 to 62 per quarter in 2016.

Sydney’s citywide median unit price, by contrast, increased by 3.5 per cent over the same period, CoreLogic data showed.

A new housing development in Mascot: an area also deemed a danger market.

Unit prices across Wolloomolloo, North Bondi, Edgecliff and other inner ring suburbs, meanwhile, jumped more than 30 per cent.

BIS Oxford Economics analyst Angie Zigomanis said the variance in price movements across city regions was the result of new housing projects tending to be overly concentrated in some areas while being rare in others.

Sydney, as a whole, was undersupplied with housing and would remain so for some time due to high migration inflows, he said.

Sam Elbanna, director of development marketer CPM Realty, said undersupply across the city as a whole made it difficult to gauge whether pockets like Parramatta really were oversupplied with housing.

“The surest sign of oversupply would be if new projects were not getting off the ground,” Mr Elbanna said. “Developers need to get a certain number of presales in order to get financing for their projects. If demand was falling and oversupply really was an issue, developers wouldn’t get those presales and we wouldn’t see any new projects being built. That’s yet to happen.”