Is right now a good time to buy a property in Sydney? (2026)

Authored by the expert who managed and guided the team behind the Australia Property Pack

Yes, the analysis of Sydney's property market is included in our pack

Is it smart to buy now in Sydney, or should I wait as of 2026?

Do real estate prices look too high in Sydney as of 2026?

As of early 2026, Sydney property prices appear stretched when measured against local incomes, with the median dwelling value sitting around A$1.27 to A$1.30 million and houses closer to A$1.58 to A$1.60 million, which translates to roughly 10 to 12 times the typical household income.

One clear on-the-ground signal that supports this view is that median days on market in Sydney sits around 33 days, which is not excessively long but not a sign of frenzied buying either, suggesting buyers are cautious about overpaying.

Another indicator worth watching is the price-to-income ratio for houses specifically, which we estimate at roughly 12 times a 2026-adjusted median household income of around A$130,000 to A$135,000, one of the highest in Australia and a level that makes entry difficult for many first-time buyers.

You can also read our latest update regarding the housing prices in Sydney.

Does a property price drop look likely in Sydney as of 2026?

As of early 2026, the likelihood of a meaningful property price decline in Sydney over the next 12 months is low to medium, primarily because supply remains constrained and there is no flood of forced sellers on the horizon.

Our plausible downside-to-upside price change range for Sydney in 2026 sits between minus 3% and plus 7%, reflecting a market that is more likely to drift sideways or edge higher than to see a sharp correction.

The single most important macro factor that would increase the odds of a Sydney price drop is a material rise in interest rates, because higher borrowing costs directly reduce what buyers can pay and squeeze existing mortgage holders.

That said, while some major banks like NAB and CBA are forecasting possible small rate hikes in early 2026, Westpac expects the RBA to hold steady at 3.60% for the year, so a big rate shock remains unlikely unless inflation surprises sharply to the upside.

Finally, please note that we cover the price trends for next year in our pack about the property market in Sydney.

Could property prices jump again in Sydney as of 2026?

As of early 2026, the likelihood of a renewed price surge in Sydney over the next 12 months is medium, with forecasters like Domain projecting house prices could rise by around 7% and approach A$1.92 million by year-end if conditions align.

Our plausible upside price change range for Sydney in 2026 sits between 5% and 8%, with most of the momentum expected in the first half of the year before affordability constraints act as a handbrake.

The single biggest demand-side trigger that could drive Sydney prices to jump again is a faster-than-expected drop in interest rates combined with expanded first-home buyer schemes, which would boost borrowing capacity and bring more buyers into the market at once.

Please also note that we regularly publish and update real estate price forecasts for Sydney here.

Are we in a buyer or a seller market in Sydney as of 2026?

As of early 2026, Sydney is leaning towards a seller-favourable market based on tight inventory and relatively quick sales, though it is not a runaway boom where every property attracts dozens of bidders.

The months-of-inventory equivalent in Sydney, based on median days on market of around 33 days, suggests supply is below a balanced level of roughly 4 to 6 months, which typically gives sellers more leverage in negotiations.

While we do not have a precise Sydney-specific share of listings with price reductions, the overall momentum of modest price growth and steady clearance rates suggests sellers are not being forced into widespread discounting, meaning they retain meaningful bargaining power.

Are homes overpriced, or fairly priced in Sydney as of 2026?

Are homes overpriced versus rents or versus incomes in Sydney as of 2026?

As of early 2026, Sydney homes appear overpriced when comparing purchase costs to incomes, but closer to fair when measured against rents, particularly for units where rental yields are stronger.

The price-to-rent ratio in Sydney for houses implies gross rental yields of roughly 2.5% to 3.2%, which is below a balanced benchmark of around 4% to 5%, meaning you pay a premium to own versus rent a house.

The price-to-income multiple for a median Sydney dwelling sits around 9.7 times a 2026-adjusted household income, and for houses it reaches roughly 12 times, well above a commonly cited affordability threshold of around 5 to 6 times.

Finally please note that you will have all the indicators you need in our property pack covering the real estate market in Sydney.

Are home prices above the long-term average in Sydney as of 2026?

As of early 2026, Sydney home prices sit above their long-term average on affordability metrics, with price-to-income ratios at historically elevated levels compared to the past two decades.

The recent 12-month price change in Sydney has tracked around 4% to 5%, which is close to the decade average of roughly 5.4% annually but slightly below the surge rates seen during 2020 to 2021.

When adjusted for inflation, Sydney prices have recovered past their prior cycle peak of 2022, meaning in real terms buyers are paying more than at any previous point in the city's history.

What local changes could move prices in Sydney as of 2026?

Are big infrastructure projects coming to Sydney as of 2026?

As of early 2026, the biggest planned infrastructure project likely to impact Sydney property prices is the Sydney Metro West line connecting the CBD to Parramatta, which has the potential to lift values by 5% to 15% in suburbs near new stations like Sydney Olympic Park and the inner-west.

The Sydney Metro West project is currently under construction, with full completion expected around 2030, and funding is already committed by the NSW Government, making it one of the most certain infrastructure catalysts for the city's west.

For the latest updates on the local projects, you can read our property market analysis about Sydney here.

Are zoning or building rules changing in Sydney as of 2026?

The single most important zoning change being implemented in Sydney is the Transport Oriented Development (TOD) program combined with the Low and Mid-Rise Housing Policy, which allows more townhouses, terraces, and mid-rise apartments to be built near train stations and in targeted areas.

As of early 2026, these rule changes are expected to have a mixed net effect on prices: they may add supply and cool price growth in upzoned corridors, while properties with development potential could see land values rise as buyers pay for rezoning upside.

The types of areas most affected are suburbs within walking distance of rail stations like those along the Sydney Metro and T1-T8 train lines, including inner-west pockets like Marrickville and Ashfield, plus middle-ring suburbs like Strathfield and Burwood.

Are foreign-buyer or mortgage rules changing in Sydney as of 2026?

As of early 2026, foreign-buyer rules in Sydney remain restrictive for established homes, with federal FIRB guidance limiting purchases to new dwellings, and NSW adding an 9% surcharge duty on top of standard stamp duty for foreign buyers, which dampens overseas demand at the margin.

The most likely foreign-buyer rule already in place is the 9% surcharge purchaser duty in NSW, plus ongoing FIRB enforcement that directs foreign buyers toward new construction rather than established stock.

On the mortgage side, APRA's macroprudential settings remain in place with a 3% serviceability buffer, and while no major new tightening has been announced, the RBA's uncertain rate path means banks remain cautious about lending at aggressive multiples.

You can also read our latest update about mortgage and interest rates in Australia.

Will it be easy to find tenants in Sydney as of 2026?

Is the renter pool growing faster than new supply in Sydney as of 2026?

As of early 2026, renter demand in Sydney continues to outpace new rental supply, with apartment completions averaging around 12,000 per year while total housing demand sits closer to 30,000 dwellings annually, creating ongoing tightness.

The best signal for renter demand in Sydney is ongoing population growth, with Greater Sydney expected to add over 650,000 residents by 2034, driven by migration and natural increase that feeds directly into rental demand.

On the supply side, new apartment completions remain below the levels needed to balance demand, with CBRE projecting Sydney apartment delivery to average only around 11,700 per year through 2030, well short of what population growth requires.

Are days-on-market for rentals falling in Sydney as of 2026?

As of early 2026, rentals in Sydney typically lease within approximately 14 days on average, though well-priced units in high-demand inner suburbs can be snapped up in as little as 5 to 7 days.

The difference in days-on-market between Sydney's best areas (like Surry Hills, Newtown, and Bondi) and weaker outer areas (like Campbelltown or Penrith) can be significant, with inner suburbs leasing in under two weeks while outer areas may take three to four weeks.

One common reason days-on-market falls in Sydney is simple undersupply: with vacancy rates around 1.4% citywide, far below the 3% balanced benchmark, landlords can fill vacancies quickly because there are more tenants searching than properties available.

Are vacancies dropping in the best areas of Sydney as of 2026?

As of early 2026, vacancy rates in Sydney's best-performing rental areas like Surry Hills, Bondi, Newtown, Marrickville, and Chatswood remain tight at around 1% or less, and they have stayed persistently low rather than dropping further from already compressed levels.

These prime inner suburbs show vacancy rates roughly 0.3 to 0.5 percentage points below the overall Sydney average of 1.4%, meaning competition for rentals is even fiercer in locations with good transport and amenities.

One practical sign that these best areas are tightening first is that landlords in inner Sydney are increasingly able to raise rents by 8% to 12% annually without losing tenants, a pattern not replicated in outer suburbs where tenant pools are thinner.

By the way, we've written a blog article detailing what are the current rent levels in Sydney.

Am I buying into a tightening market in Sydney as of 2026?

Is for-sale inventory shrinking in Sydney as of 2026?

As of early 2026, for-sale inventory in Sydney is roughly flat to slightly higher compared to the same time last year, with new listings up in the spring season but total stock not flooding the market.

The months-of-supply equivalent in Sydney, based on current sales pace and listing volumes, sits around 2 to 3 months, which is below the 4 to 6 months typically associated with a balanced market and suggests buyers face competition.

One likely reason inventory has not expanded meaningfully is that existing homeowners with low fixed-rate mortgages are reluctant to sell and take on a new loan at higher rates, a phenomenon sometimes called "rate lock-in" that keeps supply constrained.

Are homes selling faster in Sydney as of 2026?

As of early 2026, the median time-to-sell for homes in Sydney sits around 33 days, which represents steady rather than accelerating sales pace compared to the frenetic conditions of 2021.

Year-over-year, median days-on-market in Sydney has remained relatively stable, suggesting neither a sharp speedup nor a slowdown, but rather a market in equilibrium where well-priced properties move within a month.

Are new listings slowing down in Sydney as of 2026?

As of early 2026, new for-sale listings in Sydney were up year-on-year during the spring season, though we are not fully confident this trend will persist through autumn and winter when seasonal patterns typically reduce new stock.

Sydney's seasonal pattern for new listings shows a peak in September through November, followed by a quiet December-January period, and then a secondary lift in February-March, meaning the current level is not unusually low for this time of year.

One plausible reason new listings may slow later in 2026 is that homeowners with low fixed-rate mortgages locked in during 2020-2021 are hesitant to sell and refinance at today's higher rates, reducing turnover and keeping supply tight.

Is new construction failing to keep up in Sydney as of 2026?

As of early 2026, new housing completions in Sydney are falling short of what household growth requires, with apartment delivery averaging around 12,000 per year while demand sits closer to 30,000 dwellings annually across all types.

The recent trend in building approvals shows some improvement, with ABS data indicating dwelling approvals rose in late 2025, but approvals take 18 to 24 months to translate into completions, so relief is not immediate.

The single biggest bottleneck limiting new construction in Sydney is a combination of high construction costs, labor shortages, and slow permitting through local councils, which together make it difficult for developers to deliver projects profitably at scale.

Will it be easy to sell later in Sydney as of 2026?

Is resale liquidity strong enough in Sydney as of 2026?

As of early 2026, resale liquidity in Sydney is generally strong, with well-priced properties in good locations selling within about one month, though overpriced or unusual stock can take significantly longer.

The median days-on-market of around 33 days compares favorably to a healthy liquidity benchmark of 30 to 45 days, suggesting Sydney remains a market where sellers can exit reasonably quickly if priced correctly.

One property characteristic that most improves resale liquidity in Sydney is location near public transport, particularly train stations or the new metro lines, because these properties consistently attract both owner-occupiers and investors.

Is selling time getting longer in Sydney as of 2026?

As of early 2026, selling time in Sydney has remained broadly stable compared to last year, with no significant lengthening of the median days-on-market which sits around 33 days.

The realistic low-to-high range for days-on-market across most Sydney listings runs from about 14 days for well-priced properties in high-demand suburbs to 60-plus days for overpriced or less desirable stock.

One clear reason selling time could lengthen in Sydney is affordability pressure: if interest rates rise or household incomes fail to keep pace with prices, fewer buyers will qualify for mortgages, reducing the pool of active purchasers and extending listing periods.

Is it realistic to exit with profit in Sydney as of 2026?

As of early 2026, the likelihood of selling a Sydney property with a profit is medium to high if you hold for at least five to seven years, but lower for shorter holding periods due to transaction costs and price volatility.

The minimum holding period in Sydney that most often makes exiting with profit realistic is around five to seven years, which allows enough time for capital growth to outpace the substantial buying and selling costs.

The total round-trip cost drag in Sydney, including stamp duty, legal fees, agent commissions, and marketing, typically runs around 8% to 10% of the property value, or roughly A$100,000 to A$130,000 on a median-priced dwelling (approximately US$65,000 to US$85,000 or EUR 60,000 to EUR 78,000).

One clear factor that most increases profit odds in Sydney is buying in an area with upcoming infrastructure like a new metro station or rezoning for higher density, because these catalysts can drive above-average capital growth that more than offsets transaction costs.

What sources have we used to write this blog article?

Whether it's in our blog articles or the market analyses included in our property pack about Sydney, we always rely on the strongest methodology we can and we don't throw out numbers at random.

We also aim to be fully transparent, so below we've listed the authoritative sources we used, and explained how we used them and the methods behind our estimates.