Sydney Property Market – Prices, Trends, Forecast [January 2025]

Sydney experienced a mixed housing market performance in 2024, marked by a -0.6% decline in monthly dwelling values and a -1.4% drop over the quarter. Despite these short-term losses, annual values rose modestly by 2.3%, with the median dwelling value reaching $1,191,955 by the end of December.

Sydney Property Price Growth

Price growth was uneven, with annual gains attributed to earlier resilience in the market. However, affordability constraints, higher advertised supply, and reduced borrowing capacity have dampened further appreciation in property values. Sydney’s growth lagged behind mid-sized capitals like Brisbane and Adelaide, which posted double-digit increases.

CoreLogic Home Value Index

CoreLogic Home Value Index, Released on 1st January 2025

Sydney Property Market Trends

• Supply and Demand: An increase in advertised supply and reduced buyer urgency contributed to price declines in the latter part of the year.
• Segmentation: The most affordable quartile in Sydney demonstrated stronger growth compared to higher-priced segments, driven by affordability challenges pushing demand to lower-cost options.
• Rental Market: Gross rental yields stood at 3.1%, reflecting stable rental conditions despite a broader national trend of easing rental growth.

Change in dwelling values over key time periods

Sydney Property Market Forecast

Looking ahead to 2025, the market is expected to remain subdued. Modest improvements in housing affordability and a potential reduction in the cash rate are anticipated. However, significant rate cuts are unlikely to trigger substantial value growth, and affordability will remain a key factor shaping buyer behavior.

The Reserve Bank of Australia’s ongoing adjustments to interest rates will likely play a crucial role in shaping market dynamics, as higher borrowing costs limit purchasing power for many buyers.

Here are some of the most recent forecasts by the big-4 banks in Australia:

• ANZ predicts a 5-6% increase in capital city property prices in 2024, with Brisbane expected to see the highest rise at 9-10%, Perth property values could go up by 1-11%, Sydney by 4-5%, and Melbourne prices by 2-3%.
• CBA forecasts a 5% rise in capital city prices, with some variations: Brisbane is anticipated to grow by 6%, Melbourne and Perth by 5%, Sydney by 4%, and Adelaide by 1%.
• NAB projects a 5.4% average increase across the capitals, with Brisbane expected to see a 6.5% rise, Perth and Adelaide by 6.2%, Melbourne by 5.5%, Sydney by 5%, and Hobart remaining flat.
• Westpac expects a 6% growth across the combined capitals, with Perth leading at 10%, followed by Brisbane at 8%, Sydney at 6%, Adelaide at 4%, and Melbourne at 3%

Oxford Economics recently released property forecasts predicting where house prices will be in three years.

Calculate your future property value with these forecasts in mind…

Calculate your future property value with these forecasts in mind…

Enter your property details below and we will give you an estimate of the value of your home.

Property Purchase Price $1M

Average Annual Appreciation 5%

Years Since Purchase 10

CALCULATE

Future Property Value

$0

How much is my property worth?

Get Your Free Property Value Report Compare Local Agents

Conclusion for Homeowners

Sydney’s housing market ended 2024 with mixed signals, showcasing resilience in the early part of the year but slowing due to economic pressures. While affordability constraints and high borrowing costs have weighed on growth, the outlook suggests a stabilization phase in 2025, with potential for moderate recovery influenced by monetary policy changes.

Next steps