The cost of Sydney housing is insane.
According to Domain, the median house price in Sydney was $1,751,700 in the September quarter of 2025, up more than $700,000 from a decade earlier.
According to Cotality’s latest housing affordability report, the cost of the median dwelling in Sydney was valued at 10.0 times the median household income in the September quarter—easily the highest in the nation:
The typical new buyer of a Sydney home also needed to dedicate 54.5% of their household income to service the median new mortgage:
With the Reserve Bank of Australia (RBA) now expected to keep interest rates on hold, or possibly even hike rates next year, buyer demand for Sydney housing has evaporated.
Sydney’s final auction clearance rate has collapsed from a recent high of 72% for the month of August to only 63% in November and just 56.1% last weekend (7 December):
In fact, Sydney last weekend recorded its lowest final clearance rate of the year-to-date (excluding January).
Cotality’s daily dwelling values index has also collapsed.
The following chart plots the 28-day change in Cotality’s daily dwelling values index across the five major capital city markets:
As you can see, Sydney’s 28-day dwelling value index has plummeted from a recent peak of 0.9% in September, currently hovering just above 0% growth.
It appears that affordability constraints are biting hard in Sydney, which has tempered buyer demand in the face of no further expected rate cuts.
Based on recent price trends, Sydney dwelling values will soon begin to fall and likely won’t be rescued until the RBA commences another easing cycle.
