For Sydney’s property market, FY2025 has been a tale of two halves, with the median value falling over late 2024, before staging a comeback in early 2025.
By the end of June 2025, the city’s median property value stood 1.3% higher than the previous year at $1,210,222, according to CoreLogic. However, the pace of growth is accelerating, with the median value rising 0.6% in June alone.
Now, with interest rates likely to be cut further, we expect the remainder of this year to be a strong one for our local property market.
Top performers in Sydney’s eastern suburbs
While the market may be gathering pace across Sydney, many local suburbs have been experiencing even more rapid price increases over the past few months.
For instance, Potts Point’s median apartment value lifted 3.9% between March and May 2025, according to realestate.com.au. Meanwhile, Bronte’s median house price gained 5.8% over the same two months. That’s an incredible $342,500, or an average of $5,615 dollars every day.
Below we’ve set out some of the best performing suburbs and property types over the past year, all of which achieved double-digit growth.
| Suburb | Property Type | Median Value (May 2024) | Median Value (May 2025) | Annual Growth |
|---|---|---|---|---|
| Darling Point | Apartments | $2,420,000 | $2,900,000 | 19.8% |
| Bronte | Houses | $5,237,500 | $6,202,500 | 18.4% |
| Darlinghurst | Houses | $2,175,000 | $2,575,000 | 18.4% |
| Bronte | Apartments | $1,530,000 | $1,695,000 | 10.8% |
| Tamarama | Apartments | $2,000,000 | $2,200,000 | 10.0% |
* Source: Realestate.com.au market data, accessed 1 July 2025
Where the action was over the past 12 months
These figures tend to reflect the demand in the market segments we identified as being most active throughout 2025: downsizers and prestige buyers (and often a combination of the two).
For instance, Darling Point is exceptionally popular with prestige downsizers, and the reality is that there are nowhere near enough quality properties to satisfy demand from this demographic. Importantly, these buyers have been relatively shielded from higher interest rates and economic uncertainty over the past couple of years.
That means they still often had a lot of money to spend on their next move.
Increasingly, we’re also seeing prestige downsizers also look to the eastern beaches, which partly explains the performance of those suburbs too. However, the eastern beaches are generally enjoying a rise in popularity among prestige buyers more generally.
Bronte has become one of the most prestigious suburbs in all of Sydney, and anything that comes to market is guaranteed to generate significant interest. We’re also seeing a high number of major renovations, including knockdown/rebuilds which might also go some way to explaining why prices in the suburb are rising so fast.
Is the property market changing?
But while FY2025 as a whole may have been a year for parts of the prestige market, we see a more general uplift now taking place. We think it is likely to mean we’ll see strong growth in other areas too.
Most commentators are expecting at least two further rate ruts by early 2026. And, when interest rates fall, it tends to encourage two buyer groups.
The first is first time buyers, who find that the rent vs buy equation begins to favour buying. (First home buyers are also being helped out by the recent lifts in both income and property thresholds in state and federal first home owner schemes).
The other is upsizers, who find – as banks begin to slash rates – they can now afford a larger mortgage.
We believe this will lead to a real boost in demand for entry-level properties, as well as mid-market family homes across the eastern suburbs.
Supply constraints persist
But while demand may be growing, we’re still seeing a genuine shortage of stock coming to market. SQM Research’s data reveals total property listing across the eastern suburbs remain persistently low – and have done so since the onset of the pandemic.
What we find really interesting is that the gap between the number of apartments and houses on the market is growing. In other words, houses are becoming more scarce and also more likely to be held onto by their owners for some time.
This, in turn, means we’re likely to see house values continue to perform strongly – especially if more upsizers come out of the woodwork and they’re not met by a sharp increase in supply.
What’s in store for FY2026?
As we look into the second half of 2025 and into 2026, almost all signs point to 12 months of growth.
We’re not alone in holding this view, with Domain forecasting Sydney house prices to lift 7% over the next 12 months, and for the city’s median house value to crack $1.8 million. Domain also believes apartment prices will rise by an average of 6%.
Drilling down further, we expect the eastern beaches to continue to be one of Sydney’s true hotspots, and for suburbs like Clovelly, Bronte and Bondi to cement their place as the newest genuine bluechip suburbs – often taking buyers who once would have never looked beyond the harbourside.
We also expect genuine interest in inner city apartments and houses.
Many first home buyers no longer hold the same expectations about space, and are happy to settle for a one-bedroom apartment in a prime area. And with new thresholds in place, many apartments across the east now qualify for government assistance towards buying a first home.
For instance, first time buyers in NSW receive a transfer duty exemption for homes valued under $800,000, and a concession for homes valued less than $1,000,000.
With a suburb apartment median of $815,000, and a one-bedroom apartment median of $730,000 first home buyers are spoiled for choice in Potts Point.
Finally, my advice to anyone thinking of making a property move is that this is a good time to buy or sell. That’s because buyers will be entering the market before price gains and at a time while there is still value if you know where to look. Meanwhile, the lack of stock on the market means sellers are likely to find their property is in demand.
That said, the best time to sell is always when it suits you, rather than waiting for conditions to change.
Want more?
If you’re thinking of buying or selling in 2025 or 2026, contact my team today.
