Sydney remains the centre of Australia’s prestige property market, accounting for over 60% of all $5 million-plus transactions in 2024. And while other cities like Brisbane and Perth are catching up in volume, Sydney’s ultra-luxury segment continues to operate well ahead of other capitals.
According to Westpac’s 2025 Prestige Property Report, the top end of the market is moving in a different way than the broader housing cycle, driven by long-term wealth preservation rather than short-term speculation.
Here are five trends currently defining Sydney’s luxury property market:
1. Upper quartile values are outperforming
Prestige home values are rising faster than other parts of the market. Cotality (formerly CoreLogic) data shows that in Sydney, upper quartile values grew at twice the pace of the lower quartile through the first three months of the year.
This is consistent with historical patterns, where premium properties tend to lead both recoveries and downturns more sharply.
With interest rates easing and confidence in property renewed, high-value assets are again attracting strong demand, particularly in blue-chip suburbs with limited supply.
2. Buyers are focused on legacy assets
Rather than chasing quick capital gains, today’s prestige buyers are focused on generational value. That’s driving continued interest in long-held, tightly held pockets such as Bellevue Hill, Vaucluse and Mosman.
As the graph shows, these suburbs made up three of the top five suburbs nationally for $5 million-plus sales last year.
These buyers are prioritising homes with strong fundamentals: substantial land, architectural significance, proximity to the harbour and the prestige of the postcode.
Luxury property has also become a hedge against market volatility and inflation, a store of value in uncertain times.
3. Cash is still king, but credit plays a role
Most prestige buyers continue to transact with little or no reliance on credit. As property prices have grown substantially over the last five years (up 39.1% nationally), high-net-worth individuals are likely tapping into their growing equity.
However, strategic lending remains a key tool for those looking for liquidity flexibility or diversification.
4. It’s not just about location – lifestyle is important
While location will always be critical in prestige real estate, today’s buyers are equally driven by design, privacy and lifestyle features. According to Westpac, buyers are increasingly purchasing multiple prestige properties to create a lifestyle portfolio. These buyers value the flexibility to renovate or rebuild properties to suit their lifestyle requirements. For this reason, freestanding homes remain dominant in the prestige market – just 13.2% of $5 million-plus sales in 2024 were units.
However, apartments are becoming increasingly popular among downsizers, also as a result of their lifestyle. This market segment favours low-maintenance, high-amenity homes that offer convenience without compromise. And, with the country’s population ageing, prestige apartments may continue to see renewed demand.
5. Global volatility is pushing capital toward local stability
Amid international uncertainty, high-net-worth individuals are favouring stable, tangible assets like property. Investors are no longer viewing the USA as the investment haven it once was, thanks, in part, to the erratic nature of policymaking in that country.
Additionally, the Australian dollar has become more desirable as the US dollar is considered overvalued on most metrics. This has pushed buyers towards assets that are not US dollar-based.
The tax-free status of principal residences also strengthens Sydney’s and Australia’s appeal as a long-term wealth strategy.