Home prices in Sydney have shown notable stability ahead of the Reserve Bank’s announcement on a potential interest rate hike. However, experts stress that this does not necessarily signal more competitive pricing in the near future.
Economist Angus Moore from PropTrack noted that while the expected increase in the cash rate as early as tomorrow may help cool the pace of price growth, its overall impact is likely to be limited.
He explained that Sydney’s property market continues to be supported by strong fundamentals, including low unemployment and ongoing wage growth, albeit at a slower rate than seen several years ago.
Moore added that despite expectations of higher interest rates in the short term, Sydney has not experienced the same rapid price acceleration seen in cities such as Adelaide, Perth, or Brisbane. This suggests that moderate price growth is likely to persist going forward.
According to PropTrack’s latest Home Price Index report, Sydney home prices edged up by just 0.1% in January. Moore said this sluggish start to the year reflects a healthy level of housing supply in the market, which has helped ease price pressures and reduce competition to some extent.
Since January last year, Sydney home prices have risen by only 5.7%, a modest increase compared with Perth (17.5%), Brisbane (14.4%), and Adelaide (13.8%). Despite these figures, Moore believes housing affordability is unlikely to improve significantly over the next 12 months. While wage growth has provided some relief, persistently high mortgage rates and home prices continue to place pressure on first-time buyers.
Looking at Sydney’s regions, the south-west recorded the strongest growth in housing prices, rising by 12.18% since January last year. Areas such as Bankstown and Liverpool saw increases of more than 10% in the year to December, driven by their relative affordability. The sale of a luxury home on Fenwick Street for $6.45 million marked the peak price in Bankstown over the past year.
Meanwhile, data shows that regional areas of New South Wales have outperformed Sydney, with home prices rising by 7.6% since the beginning of last year. The New England region led this growth, with prices increasing by 12.81% over the past year, particularly in suburbs such as Armidale, which recorded an 11.6% rise.
Currently, the median home price in Armidale stands at around $585,000—roughly one-third of Sydney’s median home price, which is approximately $1.617 million.
