Sydney Property Market Update: Prices Decline Slightly, But Remain Nation’s Highest

In February 2025, Sydney’s property market saw a minor decline, continuing a trend of softening growth. Dwelling values decreased by 0.4% in the past month and 1.4% over the last quarter, reflecting a cooling market after the strong gains seen in 2023 and early 2024.

Sydney’s annual price growth of just 1.7%, the lowest since June 2023. This positions Sydney as one of the weaker-performing capital cities. This suggests that, in contrast to other Australian capitals, the city’s once-thriving real estate market has slowed down. However, because of affordability and population expansion, certain cities, including Brisbane and Perth, have seen larger price increases.

Despite Sydney’s slowing price growth, the city remains Australia’s most expensive property market, with a median dwelling value of $1,193,228. This illustrates the long-term resilience of Sydney’s real estate market, which is fueled by strong demand, a shortage of available land, and the city’s standing as a center of culture and the economy.

The persistence of high prices in Sydney is also influenced by ongoing supply constraints. Despite increased listings in recent months, the city still faces a chronic housing shortage, particularly in desirable inner-city and coastal suburbs. Strict planning regulations, construction delays, and high development costs limit the speed at which new housing can be supplied, keeping prices elevated.

Despite the current cooling of the market, Sydney’s resiliency is highlighted by its high median housing value. Sydney’s status as Australia’s most expensive real estate market is anticipated to be maintained by long-term demand from both domestic and foreign buyers, as well as upcoming infrastructure developments and economic expansion.

Sources: whichrealestateagent.com.au, Corelogic, realestate.com.au,  domain.com.au