The latest data from the Australian Bureau of Statistics (ABS) reveals a concerning 19% drop in NSW dwelling approvals for June.

Only 1,597 private houses were approved—the lowest number recorded since January 2013.

These figures underscore Sydney’s growing housing crisis:

• NSW’s population is increasing by over 15,000 people per month due to immigration (ABS).
• Since September 2023, the average monthly growth in rental properties has been just 218 (NSW Rental Bonds Board).
• Total dwelling approvals in NSW fell by 18.8% in June, including a 19% decline in private house approvals.

REINSW CEO Tim McKibbin’s Take on the Crisis

According to McKibbin, a combination of excessive taxation, slow approvals, and restrictive rental reforms is fueling the housing shortage:

“Demand is soaring while supply continues to shrink, creating a perfect storm that needs immediate action.”

Key concerns include:

• Tax burdens: Government-imposed taxes and charges inflate new property costs by up to 40%, making development unaffordable.
• Approval delays: Bureaucratic red tape is slowing housing development. Councils that fail to meet housing targets should lose their planning powers.
• Rental market challenges: Anti-landlord policies are discouraging investment, worsening rental shortages.

Sydney’s Housing Market Outlook for 2025

Several key trends are expected to shape the market:

• Infrastructure-driven growth: Suburbs with new transport links, hospitals, and retail precincts will likely see strong demand and price growth.
• Gentrification hotspots: Areas undergoing transformation with new cafes, restaurants, and young families moving in will offer solid capital growth.
• Population growth suburbs: Locations attracting immigrants, professionals, and families will experience increasing property demand.

Despite affordability challenges due to rising interest rates, Sydney’s housing market remains resilient. Strong immigration and limited supply will likely continue pushing property values higher.

However, the market will remain divided—affluent suburbs with high-income earners and strong equity will outperform lower-priced areas, where rising living costs and interest rates are hitting harder.

Sydney’s Top-Performing Suburbs in 2024

NSW property prices rose 9.6% over the past year, with Sydney’s wealthiest suburbs leading the charge—but some western suburbs also saw impressive gains.

Top Property Earners in Sydney

• Eastern suburbs: Bellevue Hill and Vaucluse saw property values jump by over $1 million in just a year.
• Inner West: Strathfield (+$447,417) and Abbotsford (+$401,327) recorded significant gains.
• Western Sydney: Oatlands near Parramatta (+$312,909), West Ryde (+$305,455), and Melrose Park (+$301,676) saw strong growth.
• Affordable suburbs: Even in lower-priced areas like Condell Park (+$99,953) and Wiley Park (+$98,507), property values grew more than the average Australian salary.

Sydney’s housing market remains challenging, but for investors and homeowners who choose the right suburbs, 2025 could bring significant opportunities.

3-year property price forecast (by June 2027)