The State of the Sydney Apartment Market

With the Sydney housing market moving full steam ahead, what’s happening to the Sydney apartment market?

Valuers Charter Keck Kramer (CKK) recently released their State of the Market (Apartments) for metropolitan Sydney which suggests a looming under-supply of new apartments which will lead to lower vacancy rates, higher prices for new apartments, and in turn the continuing to surge in values of well-located established Sydney

Underpinned by continued overseas and interstate migration, metropolitan Sydney according to CKK requires about 41,000 additional dwellings per annum to accommodate its current level of growth.

To meet this demand the delivery of new apartment projects is vital, particularly as affordability pressures, demographic trends, changing household types and lifestyle preferences drives the need for more diverse housing options.

And, in general, investors buy many of these new apartments – back in 2014-5 investors lending accounted for more than 50% of all property purchases in Sydney.

Investor purchases of “off the plan apartments” reached peak levels in 2015 and 16, but this was followed by a collapse in the investor apartment market as the welcome mat was pulled out from under the many foreign investors purchasing these properties.

At the same time local investors found it more difficult due to the introduction of more stringent lending practices, new APRA rules and directives and more recently fears about building standards given all the media publicity about a number of high-profile buildings with significant structural problems.

Syndey Apartment Market Stats

Sydney Apartment Market

But things have changed

Over the last few years, an apartment over supply and other regulatory and non-regulatory factors have resulted in the collapse of investor demand for Sydney “off the plan” apartments.

The reduced sales volumes have made it more difficult for developers to achieve the pre-sale hurdles required by the banks to finance developments, and a few new projects are on the drawing board.

This means that an undersupply of apartments is looming.

Looming Sydney Apartment Underssupply

Charter Keck Kramer reported that in 2019, only 25,500 apartments were completed in metropolitan Sydney.

This represents a 17% in decrease from the record 30,900 apartments completed in 2018 and suggests that the oversupply of the better quality apartments on the market will soon disappear.

The looming undersupply of new projects will lead to lower vacancy rates, rental growth and eventually property price growth of these new apartments and in turn will help fuel increased price growth of well-located established properties in Sydney.

But be careful –many of the new Legoland apartment high-rise towers will always remain secondary quality and become the slums of the future – steer clear of these.

Sydney Apartment Completions

If you’re looking at buying your next home or investment property here’s 4 ways we can help you:

Sure many of the property markets around Australia are performing well, but correct property selection is even more important than ever, as only selected sectors of the market are likely to outperform.

Why not get the independent team of property strategists and buyers’ agents at Metropole to help level the playing field for you?

We help our clients grow, protect and pass on their wealth through a range of services including:

  1. Strategic property advice. – Allow us to build a Strategic Property Plan for you and your family.  Planning is bringing the future into the present so you can do something about it now! Click here to learn more Metropole Team
  2. Buyer’s agency – As Australia’s most trusted buyers’ agents we’ve been involved in over $3Billion worth of transactions creating wealth for our clients and we can do the same for you. Our on the ground teams in Melbourne, Sydney and Brisbane bring you years of experience and perspective – that’s something money just can’t buy. We’ll help you find your next home or an investment grade property.  Click here to learn how we can help you.
  3. Wealth Advisory – We can provide you with strategic tailored financial planning and wealth advice. Click here to learn more about we can help you.
  4. Property Management – Our stress free property management services help you maximise your property returns. Click here to find out why our clients enjoy a vacancy rate considerably below the market average, our tenants stay an average of 3 years and our properties lease 10 days faster than the market average.

Subscribe & don’t miss a single episode of Michael Yardney’s podcast

Hear Michael & a select panel of guest experts discuss property investment, success & money related topics. Subscribe now, whether you're on an Apple or Android handset.

Need help listening to Michael Yardney’s podcast from your phone or tablet?

We have created easy to follow instructions for you whether you're on iPhone / iPad or an Android device.


Prefer to subscribe via email?

Join Michael Yardney's inner circle of daily subscribers and get into the head of Australia's best property investment advisor and a wide team of leading property researchers and commentators.

Michael Yardney


Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and one of Australia's 50 most influential Thought Leaders. His opinions are regularly featured in the media. Visit

'The State of the Sydney Apartment Market' have no comments

Be the first to comment this post!

Would you like to share your thoughts?

Your email address will not be published.


Copyright © Michael Yardney’s Property Investment Update Important Information
Content Marketing by GridConcepts