Spring has brought a noticeable shift in momentum across Sydney’s eastern suburbs property market.
After a subdued start to the year, confidence has returned – and it has returned decisively – with strong buyer depth and growing competition often translating into solid price growth.
We explore what’s been happening in the local property market over the last few months, and what to expect as we head into 2026.
What the data shows about the eastern suburbs property market
The market data also shows the broad uplift we’ve been noticing. Sydney’s median house value increased 0.7% in October 2025, according to Cotality (formerly Corelogic). It also registered a 2.3% gain in the three months ending 30 October – making it the highest quarterly growth our city’s median price has experienced since 2021.
Should it continue, this puts Sydney on track for annual growth in the high single digits over the coming year, something almost unthinkable at the start of the year, and well above most analysts’ forecasts.
Recent auction activity also suggests a market in growth mode. Domain’s auction clearance rate has held close to – or above – 70% almost every week since mid-year, a threshold usually associated with a clear sellers’ market.
What makes this more compelling is that the clearance rate has remained strong even as more homes come to market. October auction volumes were roughly 15%–20% higher than the same time last year, showing that buyers aren’t just active – they’re confident enough to bid strongly, and there is more than enough demand to cover any spike in listings.
Moving closer to home, the numbers look better still. On the weekend of 8 November, the auction clearance rate for City and East was reported at 75.5%, and several suburbs have been experiencing growth well beyond the Sydney average.
What’s driving the local property market in late 2025?
Importantly, this momentum isn’t coming from one buyer group. Instead, we’re seeing several different demographics beginning to compete more aggressively. With the RBA’s recent rate cuts now fully priced in, borrowing capacity has improved noticeably, and that’s flowing into more activity and stronger bidding.
First home buyers have noticeably surged back into the eastern suburbs property market – especially for apartments. This partly comes as a result of lower home loan rates. However, it is also due to October’s changes to the Home Guarantee Scheme (which allows first home buyers to purchase with a 5% deposit and no lenders mortgage insurance) dropped both quotas and income caps, while lifting the property threshold to $1.5 million.
As a result, a lot more local first home buyers are now eligible for the scheme and a lot more eastern suburbs properties fall within its scope. In fact, the median apartment in almost every suburb now sits within the scheme’s parameters.
Meanwhile, next-home buyers – many of whom have been sitting on the sidelines since rates began rising in 2022 – are finally feeling enough budget certainty to move. This is freeing up stock and delivering more properties to market just as they’re needed.
At the same time, downsizers remain active – although a lack of suitable stock remains something of a bottleneck.
Finally, investors – who are an important buyer group in many parts of the east – are returning in numbers. In fact, official lending data shows they could be the fastest-growing buyer group of all.
While the September quarter saw a significant bump in lending generally – up 6.4% from the June quarter – investor lending rose by 13.6% in just three months.
Taken together, the macro picture is clear: confidence has returned and the market is back in growth mode again.
Sydney’s inner east seeing strong activity
This combination of factors is having a disproportionate impact on Sydney’s eastern suburbs – partly because it has a higher number of apartments than most of the city, and these tend to attract more first home buyers and investors.
For instance, Potts Point’s median apartment value lifted 5.2% in October alone, taking it to $857,700, according to realestate.com.au.
But it’s inner city houses that have been the star performers over the last 12 months, with Darlinghurst’s median house value jumping 17.0% in the year to October 2025. Next door in Surry Hills, house prices lifted 14.3% over the same period.
In general, we’re seeing strong activity across the board in these suburbs and we expect the property mix and buyer type here will lead to oversized gains over the coming year.
The eastern beaches: new suburbs and property types taking off
For some time now, Sydney’s eastern beaches have been performing way above the odds with Bronte’s median house price rising 64% over the past five years to $5.8 million.
While Bronte houses are still doing well (up 7.7% over the last year), the most impressive growth in the last 12 months has come from its next door neighbour, Clovelly, where the median house value has risen 20.5% over the past year to $5.485 million. House prices in Bondi have also jumped 16.6% to $4.43 million.
Interestingly, it’s apartments in Bronte that are now experiencing double digit growth, with the median value rising 15.3% in the year to October 2025 to now stand at $1.7 million. Apartment values in North Bondi (up 18.0%), South Coogee (up 10.8%) and Marboubra (up 13.4%) also saw dramatic gains.
This is likely happening as more downsizers choose seaside over urban or suburban living, as well as an increase in families and professional couples choosing an apartment-based lifestyle by the beach over a family home.
What to expect for the year ahead
As we move into 2026, the fundamentals underpinning this year’s success look set to strengthen rather than fade.
The impact of rate cuts is still flowing through the system. More properties are coming to market, but buyer depth is expanding even faster. Investors are returning at a pace we haven’t seen since 2021. And in tightly-held suburbs like Potts Point, Elizabeth Bay, Rushcutters Bay, Darlinghurst and Surry Hills, demand is rising faster than supply can keep up.
That imbalance is usually what drives the next stage of growth.
In the eastern beaches, too, the story is shifting. New suburbs are stepping into the spotlight and apartments are beginning to account for a greater share of the price gains.
Overall, we’re heading into 2026 with a market that is confident, competitive and increasingly selective. Buyers know what they want, and they’re prepared to pay for quality – especially in suburbs where lifestyle, amenity and scarcity combine.
If you’re considering buying or selling in the inner east or eastern beaches, the most important step is understanding where your home sits in this changing landscape
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If you’re thinking of buying or selling in 2026, contact my team today.
