Sydney Property Market Update
March 2026
As Sydney moves further into 2026, the residential property market remains supported by solid underlying fundamentals; however, signs of moderation are beginning to emerge.
According to the CoreLogic RP Data Daily Home Value Index as at 28 February 2026, Sydney dwelling values are up 6.0% over the past 12 months, while quarterly and monthly growth have come in at -0.1% and 0.0% respectively.
Auction clearance rates remained consistently solid throughout 2025, typically sitting between the high-60s and mid-70s. 2026 started strongly; however, clearance rates have declined week-on-week to date and are currently sitting in the low 60s. Performance continues to vary depending on suburb, property type and presentation.
Looking ahead, we expect tightly held, high-demand suburbs to remain competitive, particularly for well-presented properties. These should continue to attract strong buyer interest and achieve solid results.
Buyer preferences are continuing to evolve. The long-held strategy of “buying the worst house in the best street” has become less attractive due to elevated renovation costs and ongoing builder shortages. As a result, many buyers are prepared to pay a premium for fully renovated properties that offer immediate liveability and greater cost certainty. That said, we expect knock-down rebuilds to remain a strong theme across many Sydney suburbs.
Properties with drawbacks such as high-traffic positions, awkward layouts or less-favoured locations are attracting more measured interest and often face limited bidding momentum on auction day.
At the policy level, the Federal Government’s Home Guarantee Scheme, which commenced in October 2025, is expected to continue supporting demand at the entry level (up to $1.5M), adding further upward pressure to prices in that segment of the market.
Looking ahead, the escalating conflict in the Middle East has increased the likelihood of further interest-rate rises. Following the 0.25% rate increase in both February and March 2026, and with markets predicting a possible follow-up rise in May, we are beginning to see some moderation in buyer demand.
However, our broader outlook for the Sydney housing market remains largely unchanged. Strong population growth driven by high immigration, combined with a chronic undersupply of housing, continues to underpin market demand. As a result, any softening in market conditions is likely to be modest rather than significant in the short to medium term.
Sydney property market statistics
Growth figures
According to the CoreLogic RP Data Daily Home Value Index as of 28 February 2026, Sydney dwelling values have recorded the following growth:
Overall Dwellings:
Annual: +6.0%
Quarterly: -0.1%
February 2026: +0.0%
Houses:
Annual: +6.8%
Quarterly: -0.4%
February 2026: -0.2%
Units:
Annual: +3.9%
Quarterly: +0.8%
February 2026: +0.5%
National Comparison (Annual): Sydney’s growth lags behind top performers like Darwin (+19.4%) and Perth (+22.0%), and is only ahead of Melbourne (+4.7%) on an annual basis.
Sydney Median Prices
Houses: $1,607,046
Units: $903,080
Auction clearance rates
In 2025, Sydney’s auction clearance rates remained relatively stable, generally ranging from the mid-60s to early-70s.
The first auction weekend of 2026 started strongly with a clearance rate of 78%. Clearance rates since then have trended downwards week on week currently sitting around 60%.
Clearance rates provide a useful snapshot of market activity, but it’s important to recognise that the figure is an average across all Sydney suburbs. It does not capture the often significant variation between locations. Premium or highly desired suburbs typically achieve higher clearance rates, driven by strong demand and limited supply, while less sought-after areas may record weaker results.
Auction Clearance Rates 2023 - 2026
Interest rates
Interest Rates and the Economic Outlook
Interest rates remain one of the most significant factors influencing buyer sentiment and housing market activity.
Between May 2022 and November 2023, the Reserve Bank of Australia (RBA) implemented thirteen consecutive interest rate increases, lifting the cash rate from a historic low of 0.10% to 4.35%.
As inflation began to ease through 2024 and into 2025, the RBA shifted its policy stance, cutting the cash rate by 0.25% in February, May and August 2025, bringing it down to 3.60%. However, in February 2026 the RBA reversed course once again, responding to stronger-than-expected inflation by increasing the cash rate by 0.25% to 3.85%, with a further increase of 0.25% at the most recent meeting on 17 March.
As 2026 progresses, the outlook has become more uncertain. Inflation has proven more persistent than anticipated. Ongoing conflict in the Middle East, combined with inflation running above the RBA’s forecasts, has led markets to price in the possibility of another 0.25% rate increase in May.
This marks a renewed tightening phase and reinforces the RBA’s commitment to bringing inflation under control, even at the risk of moderating economic activity and housing market momentum.
The next RBA meetings for 2026 are scheduled as follows:
- May 4–5
- Jun 15–16
- Aug 10–11
- Sep 28–29
- Nov 2–3
- Dec 7–8
Reserve Bank Cash Rates 2019 - 2026
Rental vacancy rates
According to the latest SQM Research Rental Vacancy Survey for February 2026, Sydney’s residential vacancy rate has tightened further, now sitting at 1.3%.
This remains well below what is typically considered a balanced rental market (around 3.0%–3.5%), with demand continuing to significantly outpace supply. A substantial increase in available rental stock will be required before more balanced conditions can be achieved.
Sydney Property Market Observations
Market Observations: Early 2026
Open Homes
Open-for-inspections have been well attended, reflecting the typical resurgence in buyer activity following the Christmas break. That said, we are sensing a degree of caution among buyers, with some hesitancy to commit at this stage due to ongoing uncertainty around interest rate settings, conflict in the Middle East, and the associated impacts on oil prices and equity markets.
Underquoting
Underquoting remains a persistent feature of the Sydney property market and continues to frustrate buyers. In response, NSW Fair Trading introduced compulsory training on the issue as part of the 2024/25 Continuing Professional Development (CPD) program for agents. The NSW government is also introducing legislation to substantially increase penalties for underquoting.
The real test, however, will be whether these initiatives are supported by meaningful enforcement. To date, penalties have been limited and inconsistently applied.
Immigration
High immigration levels are expected to persist into the foreseeable future, placing further pressure on an already undersupplied property market and driving demand for both housing and rental accommodation. Without a meaningful increase in new housing supply, strong competition is likely to persist, sustaining upward pressure on prices.
Rezoning
To ease supply pressures, the NSW Government has announced widespread rezoning across Sydney, particularly around major transport hubs, to facilitate the delivery of a substantial number of new dwellings, predominantly apartments. The objective is to alleviate the region’s housing shortage by shifting large areas of land from low density to medium and high density use.
Unsurprisingly, the proposals have generated concern and uncertainty within affected communities, with many awaiting clarity as the finer details of the rezoning process are finalised.
Where To From here?
In recent years, the Sydney property market has consistently defied predictions, shaped by a complex mix of global and domestic forces. COVID-19 lockdowns, inflationary pressures, and rapid interest rate rises were all expected to cool demand, yet the market has remained remarkably resilient. More recently, international political uncertainties, including ongoing conflicts as well as shifts in US leadership and policy, have added further layers of complexity, making reliable forecasting even more challenging.
Yet despite these uncertainties, the core fundamentals of the Sydney market remain intact—most notably, the persistent imbalance between supply and demand.
For buyers, however, strategy is more important than ever. Avoiding overpayment requires rigorous due diligence, a clear understanding of fair market value, and disciplined negotiation. It is also critical to stay across the NSW Government’s planning reforms and rezoning initiatives, as these changes may reshape neighbourhood density, drive new development, and influence property values over the medium to long term. Factoring these considerations into purchasing decisions will be key to securing both value and future growth.
In a market shaped by evolving economic conditions and policy changes, informed decision-making and experienced guidance remain critical to achieving successful property outcomes.
This Week's Sydney Auction Results
Each week, we take a look at Sydney’s latest auction clearance rates to give you a snapshot of market activity and buyer demand. These figures are a key indicator of confidence in the property market—helping both buyers and sellers understand how properties are performing right now.
Our Latest Insights
Don’t Get Caught by an Underqualified Buyers Agent
In a growing industry, how can you protect yourself and ensure you choose a reputable buyers agent
The Woollahra Rezoning: Will It Really Deliver Affordable Housing?
Will the latest Minns Government proposal ease the housing affordability crisis?
Home Guarantee Scheme
Home Guarantee Scheme Revamp from 1 October 2025: What First Home Buyers Need to Know
Gaining Access to Sydney’s Finest & Prestige Properties
As Buyer’s Agents, we have the privilege of viewing Sydney’s most exclusive high-end homes—many of which are off-limits to the general public.
At Homesearch Solutions, we provide exclusive access to private viewings and off-market properties, ensuring you don’t miss out on Sydney’s most prestigious real estate opportunities.
What our clients say about us.
Read our 5-star reviews on Google Business
“My partner and I were very glad to have worked with Homesearch Solutions for our first home purchase in Sydney. Henry was very knowledgeable and thoughtful, both in aiding us find good property options, making offers and negotiating, and helping us work through the overall purchase process...”
C.J
Inner West
“Henry was absolutely incredible to work with! We couldn't have bought our place with the speed and confidence that we did without him. Being first time property buyers in the Sydney market is intimidating and confusing, but Henry guided us through the entire process with patience and professionalism...”
I.U
Northern Beaches
“I have worked with Henry at Homesearch twice in the past five years, and it has been a GREAT experience. Henry is diligent, responsive, level-headed, and incredibly knowledgeable. I wouldn't take a step into the shark-infested waters of the Sydney property market without him on my team. I can't recommend him highly enough”
J.L
Eastern Suburbs