M:
Headlines
Summer 25/26
Sydney Residential
Economy Key drivers
Residential sales Update
Sales -11%
Sydney residential sale transactions tallied to 18,767 in the third quarter of 2025, down 11% from the previous quarter In the past year, the total number was 22% lower, reaching 90,862 sales This was shaped by restrictive lending conditions and an overall lower number of properties listed for sale on the market As a benchmark over the past five years, the quarter tally averaged 27,623 sales and annually, this average was 110,565 sales
Auctions
1,164
In the last week of September 2025, 1,164 residential auctions were held across Sydney. According to Cotality, 70.2% of the homes were sold under the hammer Clearance rates above 70% suggest strong demand and a seller’s market, while a rate below 60% indicates weaker demand and a buyer’s market This result was higher than 67 2% one quarter ago when 771 auctions were held By comparison, the same quarter last year saw 60 9% homes sold, from 1,199 auctions
Tracking the total number of sales each quarter
Sydney
70.2%
Auction clearance rate
Sydney
Residential sales Update
Duration +21 days
Sydney homes averaged 74 days on market in Q3 2025, from the time they were listed to the day they went under contract This average duration was 69 days (+5 days) the quarter before and 52 days (+21 days) one year ago A lower number of days on market tends to mean homes are selling faster with more desirable properties, while a higher number of days suggests a slower market with above market values. Looking back over the five-year average, it has taken 61 days to sell a home
Tracking average days on the market
New listings
Newly advertised property listings in Sydney were 11 0% lower in the month of September 2025 than the equivalent period last year, according to Cotality This change trended below the Australian average of -10.3% but above the -11.2% across Australian capital cities
Sydney’s total number of listings in the month of September 2025 were 9.2% below the equivalent period last year, according to Cotality By comparison, the Australian average change for total listings was -13.3% and across Australian capital cities was -13 6%
Change from a year ago
Median price
$1,352,500
Residential property prices across Sydney rose by 5 3% in the year ending Q3 2025, with a 3 0% increase recorded in the most recent quarter This brought the median residential value to $1,352,500, reflecting a steady upward trajectory in housing demand and underlying resilience in the market. Annual residential price growth has averaged 7 1% over the past five years.
Tracking median prices Sydney
Sydney Price outlook +6%
Forecast for median prices
Looking ahead, McGrath Research forecasts Sydney residential property prices to increase by 6% by the end of 2025, followed by a similar 6% rise in 2026. These projections reflect a mix of ongoing demand from limited housing supply, a longer average number of days on market and a lowered number of sales transactions
Sydney, Q3/25
Residential rents Update
Sydney Vacancy 2.2%
Tracking residential rental vacancy
Sydney residential rental vacancy was recorded at 2 2% in Q3 2025, rising 50 bps in the quarter and 50 bps over the past year according to REIA Generally, around 3% vacancy is considered a balanced market between rental supply and demand Below this equilibrium is considered to be an undersupplied pool of rental homes. Over the past five years, rental vacancy has averaged 2 0% per year
Sydney Yield +7 bps
Tracking gross rental yield
Residential gross rental yields tightened 4 bps in the Q3 2025 quarter to be 3 74% across Sydney, whilst being 7 bps more than a year ago. Gross rental yields are a good initial measure of comparing the return of a property investment before expenses are deducted. A yield greater than 4% tends to be considered most desirable for properties located in capital cities, while below this, tends to indicate high property prices relative to rent, or low rental demand Gross rental yields have averaged 3 45% over the past five years
from a year ago
Residential rents Update
Sydney Median weekly rent $765
Tracking median weekly rents
Sydney residential rents rose 0.7% in Q3 2025, while increasing 2 7% over the past year, to stand at $765 per week Low vacancy and high migration have kept rents elevated, albeit now rising at a slower pace than previous years On average, over the past five years, rents grew 8 1% per year.
Sydney Rental outlook +4%
Forecast for median rents
Whilst Sydney continues to experience tight rental supply and delayed delivery of new homes, McGrath Research forecast sustained upward pressure on rents of 5% at the end of 2025, with a further 4% rental growth likely in 2026
Sydney
Sydney refers to the Greater Capital City Statistical Area or ‘Greater Sydney’ as defined by the Australian Bureau of Statistics.
Guiding you home
Michelle Ciesielski National Head of Research, McGrath Research
www.mcgrath.com.au/research
Find an agent