Market Snapshot: Sydney’s Property Performance
Steady Price Growth
Sydney continues to experience moderate but consistent gains across both houses and units.
Dwelling values climbed 0.6% in July 2025, with a quarterly rise of 1.8% and a 1.6% annual increase; the median dwelling value now stands at approximately A$1.228 million.
Houses are up 0.8% for the month, 1.9% quarterly, and 2.2% annually, with a median price of A$1.525 million.
Units added 0.2% monthly, 1.3% quarterly, but no net annual growth, with a median of A$868k.
Sydney led capital city monthly gains in August, with a 0.7% increase, outpacing the national average even though regions have posted stronger annual growth.
Market Drivers & Dynamics
Lower Interest Rates Fuel Demand
The RBA has trimmed the cash rate to 3.60%, significantly improving buyer sentiment and borrowing power.
Tight Supply
Housing approvals have plunged, with only 22,297 standalone homes approved in NSW over the year to July—a nearly 30% drop from 2021—while apartment approvals rose but remain below historical peaks.
Strong Buyer Competition
Auction clearance rates are surging and listings remain low, keeping competition fierce.
First-Home Buyer Shift
First-time buyers are exploring affordable suburbs like Granville, where new one-bedroom apartments are available from under A$550k; innovative funding tools are also easing entry barriers.
Future Outlook: What Comes Next?
Price Growth Projections
Analysts forecast steady gains for 2025, ranging between 2.3% and 5.5% for houses. Long-term outlooks suggest the median house price could hit A$2 million by 2030.
Further Rate Cuts Expected
Financial institutions expect additional rate reductions through early 2026—pushing rates potentially down to 3.1–3.35%—which may further boost price growth.
Escalating Affordability Crisis
Median house prices may reach A$1.83 million in 2025, nearly double the national average, leading many families to relocate from Sydney; structural reforms are being urged to alleviate the crisis.
Forecasts for 2026
KPMG anticipates most price acceleration to occur in 2026, driven by easing rates and pent-up demand.
Summary: Sydney Property Market at a Glance
| Category | Detail |
|---|---|
| Current Trend | Modest but steady growth in both houses and units |
| Primary Drivers | Low interest rates, tight supply, strong buyer competition |
| Key Market Moves | First-home buyers pivoting to outer suburbs; luxury properties booming |
| Looking Ahead | Moderate gains expected in 2025; stronger growth likely in 2026 |
| Concerns | Affordability pressure and migration outflows |