Sydney’s 10 best and worst property markets and what’s hot into 2026

Sydney’s property market is among the most expensive in the world, with only Hong Kong outpointing it as the least affordable property market on the planet.

There are few signs of that situation reversing any time soon.

While it is uniformly expensive, with its $1.24 million median dwelling value far beyond the other state capitals, the past 12 months have delivered wildly different results throughout the city.

And for property investors trying to assess which suburbs will deliver the best capital growth prospects over the coming year, it is a disparate list of hotspots that have caught the eye of a range of commentators who shared their forecasts with API Magazine.

Among the ten best and worst house and unit markets (see four tables below, provided exclusively to API Magazine by Cotality) there were some distinct trends that were specific to each housing type.

For houses, both the best and worst lists had a wide range of median prices. While all are expensive by national standards, the fact the biggest price gain over 12 months was for a suburb with a median house price of $845,000 and the third best performer was almost $6.6 million speaks volumes for the fact house prices are not limited to a particular price range.

TOP 10: Best median HOUSE price performance

Suburb Name	Median value	1 year change	5 year change
Chain Valley Bay	$844,832	16.8%	64.6%
Menangle Park	$1,185,580	16.3%	140.7%
Bronte	$6,583,805	15.3%	61.4%
Strathfield	$4,472,079	14.3%	62.1%
Dulwich Hill	$2,482,431	13.5%	48.9%
Enfield	$2,397,145	13.5%	70.2%
Old Guildford	$1,289,873	13.4%	61.4%
South Hurstville	$2,007,587	12.8%	55.6%
Bondi Beach	$4,815,488	12.7%	66.7%
Tempe	$1,883,171	11.9%	43.6%

REINSW President and CEO and Director of BresicWhitney, Thomas McGlynn, said Sydney could not be viewed in isolation.

“Sydney is the country’s most complex property market with many microclimates within it, resulting in a mixed picture across the data.

“Values in Bronte for example, have likely been driven by tightly held, premium properties with water views, while growth in Dulwich Hill on the other hand, is likely an uplift as a result of transport and infrastructure developments,” he told API Magazine.

Among the bottom ten for declining house markets, it was a far more consistent picture with homes comfortably above the median $1,550,563 house price faring poorly. Seven of the top ten were priced in the two millions and all were above the median value.

BOTTOM 10: Worst median HOUSE price performance

Suburb Name	Median value	1 year change	5 year change
Terrey Hills	$2,589,203	-12.2%	11.1%
Marsfield	$2,537,733	-6.4%	41.2%
South Turramurra	$2,489,991	-6.3%	47.3%
Little Bay	$2,825,086	-6.2%	30.1%
Kensington	$3,551,754	-5.4%	37.8%
Avalon Beach	$2,842,612	-5.1%	38.6%
West Ryde	$2,230,945	-4.1%	37.5%
Alexandria	$2,229,890	-3.3%	39.2%
North Rocks	$1,891,070	-2.7%	47.4%
Maroubra	$3,079,437	-2.7%	46.7%

The best performing unit markets over the past 12 months showed a clear disposition toward the affordable end of the market.

Only three of the best performing suburbs had a median price above $900,000, while all ten of the worst performing unit markets were above that price mark. The median unit price in Sydney is $880,777.

Allen Habbouchi, Principal Licensee – Sydney for aussieproperty.com, pointed to affordability issues holding back the pricier unit markets.

“The trend toward more affordable units likely reflects stronger demand from downsizers and first home buyers, especially given tighter lending conditions for high-value properties.

“Some higher-priced suburbs may have experienced a plateau after strong growth, making more affordable areas more attractive now.”

TOP 10: Best median UNIT price performance

Suburb Name	Median value	1 year change	5 year change
Belrose	$1,022,945	22.0%	36.8%
Moorebank	$839,438	12.0%	12.8%
Belfield	$883,278	11.9%	22.9%
Werrington	$681,234	11.1%	36.7%
Willoughby	$1,242,288	10.5%	21.9%
Beverly Hills	$874,016	8.9%	23.6%
Lurnea	$716,629	8.8%	37.8%
Lakemba	$546,432	8.5%	19.8%
Casula	$860,759	8.5%	30.6%
Condell Park	$1,067,671	8.3%	41.1%

Arija McQuillan, Buyers Agent and founder of Ari Agency, said overseas migration was also shaping the Sydney unit market.

“Sydney is home to more and more primary residents immigrating from overseas and we are seeing more buyers subject to a tighter budget, which forces them to buy where they can afford and rent where they want to live.

“I have fielded a lot of enquiries from buyers with less than $1 million looking to rentvest in cheaper suburbs so they can still maintain a lifestyle in their ideal location.

“Some of the worst performers are too expensive for people to invest in so it would make sense that the growth in these areas is slow, allowing better purchasing power to those looking for their primary residence.”

BOTTOM 10: Worst median UNIT price performance

Suburb Name	Median value	1 year change	5 year change
Kirribilli	$1,643,133	-19.0%	-19.1%
McMahons Point	$1,406,086	-11.5%	6.1%
Gymea Bay	$1,394,985	-9.7%	25.4%
Milsons Point	$1,969,123	-9.4%	6.1%
Vaucluse	$1,491,940	-9.3%	17.8%
Centennial Park	$964,412	-9.2%	16.8%
Darling Point	$2,462,080	-8.3%	20.2%
Cremorne Point	$1,881,836	-8.0%	5.5%
Beecroft	$974,271	-8.0%	-7.0%
Kurraba Point	$1,526,451	-7.8%	4.4%

Head of Research at Cotality, Eliza Owen, agreed the lower end of the unit market was heated.

“The diversity of markets in the top-performing lists reflects an inflection point in the housing cycle.

“In mid-to-late 2024, middle and low value segments of the Sydney housing market dominated growth, potentially because the combination of high interest rates, cost of living pressures and lower savings pushed buyers to traditionally more affordable markets.

“These include Tempe houses, which is at least relatively affordable for houses in the Inner West, Lakemba, Belfield and Chain Valley Bay in Wyong.

“Laced in with this though are very high-end markets starting to emerge in the top-performers list, like Bronte and Bondi Beach, because of changed conditions in 2025.

“Falling interest rates have historically been relatively quick to take effect in very high-end markets.

“At the low end of the league tables though, you still see the weight of affordability pressures affecting traditionally more expensive pockets of Sydney, and the longer-term trend shows high end units have been less appealing.”

More to market than deposit scheme

A variety of factors were driving the market, but the commentators broadly agreed that the Home Guarantee Scheme allowing first time buyers to pay just a 5 per cent deposit was not a big factor in Sydney.

“I would guess it has had very little impact,” Ms Owen said.

“It’s worth noting the scheme didn’t kick off until 1 October and the Sydney growth had already accelerated to 0.8 per cent in September.

Thomas McGlynn, President of REINSW and CEO of BresicWhitney

“Ultimately we put the acceleration down to other factors like multiple rate cuts, growth in real incomes, tight supply levels and improved consumer sentiment.”

Mr McGlynn said price increases in Sydney are rarely the result of one incentive.

“They remain driven by deeper structural forces, particularly undersupply, across the lifestyle markets.

“Prices at the more affordable end may increase due to more competition between first-home buyers as a result of the scheme but the largest impacts right now are down to sentiment and the timeframe in which many first-home buyers can enter the market.

“We saw similar uplifts in sentiment and perceived opportunity following the interest rate cuts, however these proved to be ‘sugar hits’ rather than long-term shifts.

“More investors are returning to the Sydney market, however not with great force yet,” Mr McGlynn said.

Sydney’s 2026 hotspots

Given the somewhat eclectic performance of Sydney real estate over the last 12 months, where should property investors and prospective buyers be looking if they want to see their investment pay off in 2026 and beyond?

The four commentators API Magazine spoke to come from a range of real estate backgrounds, including data analysis and research, buyers agent, peak body leadership and sales.

For Ms Owen, there were options for all budgets.

“I would still place a bit of confidence in Lakemba, for houses or units, for another year.

“It’s one of the last affordable pockets for Sydneysiders and close proximity to the trendy Inner West makes it an increasingly desirable option for young renters and homebuyers, and the same goes for areas like Canterbury and Campsie, which are well located but still have some bang for buck.

“If you’ve got a big, big budget, the short-term capital growth opportunities seem to be in the North Eastern suburbs pocket of Sydney, with short-term growth currently accelerating in markets like Waverley, Bondi Beach, Bronte and Queens Park.

“Developable, rezoned areas are also good for sellers at the moment, with the likes of St Marys seeing strong sales results in anticipation of the new metro airport line and upzoned land.”

Government and private investment that was transforming parts of the city were the focus for Mr MGlynn.

“We are closely watching suburbs subject to new infrastructure and transport developments, like Dulwich Hill.

“These areas often see increases in new housing supply alongside this, presenting more opportunity for investors, buyers and tenants,

“Areas with a mix of established units and homes that are tightly held, like Strathfield or Willoughby, are likely to attract investor interest.”

Ms McQuillan said she usually advocates for blue chip locations close to the city, while Mr Habbouchi said he would suggest looking at emerging suburbs with ongoing infrastructure projects and good rental demand.

“Areas like Parramatta, Zetland, and Liverpool are benefiting from major developments like transport upgrades and urban renewal, which are expected to drive demand and appreciation amid broader Sydney market forecasts of 5to 8 per cent growth citywide in 2026,” Mr Habbouchi said.