18 Jun Riding the Sydney Property Cycle: Understanding the ups and downs of a suburb’s performance
The real estate market is inherently cyclical. Suburbs rise and fall in popularity, pricing, and growth potential over time. While some investors get caught in the noise of short-term trends, experienced property buyers understand that timing and suburb selection can mean the difference between strong capital growth and stagnation.
At Premier Home Finders, we work closely with our clients and interpret market signals and identify suburbs at key turning points—whether that means uncovering opportunity in a softening market or recognising the signs of an area on the brink of strong growth.
Why Suburbs Cycle
Suburb performance fluctuates due to a range of factors—interest rate changes, government policy, infrastructure developments, school rezoning, or lifestyle trends. For example, a once-overlooked suburb may suddenly attract attention due to a new transport hub or a wave of lifestyle-oriented cafés and amenities. Conversely, a high-performing suburb might plateau or even decline temporarily due to oversupply, rezoning, or market correction after rapid growth.
Understanding this ebb and flow allows buyers to time their entry strategically and protect capital over the long term.
Blue-chip Sydney suburbs where median home values declined in the last 12 months
| Suburb | State | Median house price | 12-month change | |
| 1 | Manly | NSW | $3.81m | -17.8% |
| 2 | Neutral Bay | NSW | $3m | -12.4% |
| 3 | Clovelly | NSW | $4.49m | -9% |
| 4 | Coogee | NSW | $4.22m | -7.8% |
| 5 | Woollahra | NSW | $4.58m | -7.1% |
| 6 | Cremorne | NSW | $3.96m | -6.9% |
| 7 | Rose Bay | NSW | $6.42m | -4.8% |
| 8 | Bellevue Hill | NSW | $10.97m | -4.8% |
| 9 | Castlecrag | NSW | $4.45m | -4.2% |
| 10 | Fairlight | NSW | $3.9m | -3.9% |
Source: Source: CoreLogic 12 months to May 2025
Let’s take a closer look at Manly, which experienced the largest median price dip.
- In May 2025, the median home value fell by 8.9% to $3.81m, which was the same median value recorded in late 2023.
- New listings have decreased over the 12-month period by -18.7%.
- There are 12 homes currently for sale, 8 of them have a $5m+ price guide.
- Manly has recorded four home sales above $20m in the last 3 years, with one selling in March 2025.
What To Look For In A Downward Market
For property buyers, a suburb in decline isn’t necessarily a red flag. In fact, it can present a golden opportunity for long-term investors. Here’s what to consider when evaluating a suburb that’s trending downward:
1. Core Fundamentals
- Proximity to the CBD, beaches, transport, and quality schools.
- Established housing stock and attractive streetscapes.
- Low crime rates and high owner-occupier appeal.
2. Rental Yields and Vacancy Rates
- A suburb with steady or improving rental returns, even in a slow market, suggests resilient demand.
3. Demographic Shifts
- Are young professionals or families moving in?
- Look for early signs of gentrification: renovations, new cafés, and boutique retailers.
4. Infrastructure Commitments
- Major transport upgrades or commercial developments in the pipeline can signal future growth potential.
5. Sales Volume and Days on Market
- Suburbs with dropping prices but low sales volume might simply be experiencing a temporary lull—not a long-term decline.
What To Look For In A Rising Suburb
Spotting an upturn early can set you up for exceptional gains. Here’s how to identify a suburb on the upswing:
1. Increased Buyer Demand
- Open homes are busier, and auction clearance rates are rising. The total number of sales are increasing – even if prices aren’t yet.
2. Gentrification in Full Swing
- Streets are being rejuvenated, heritage homes restored, and new hospitality venues are popping up.
3. School and Lifestyle Drawcards
- Families are prioritising good schools, safe streets, and lifestyle amenities—watch for increasing school enrolments and rezoning impacts.
4. Consistent Price Growth
- Even in a broader soft market, some suburbs show consistent, steady price appreciation, often driven by scarcity and desirability.
5. Tightening Supply
- A decline in new listings and reduced time on market is a strong signal that demand is outweighing supply.
Strategy is Everything
Understanding the cyclical nature of suburbs empowers you to make informed, strategic decisions. Rather than chasing hotspots or panicking in downturns, align your investment with long-term fundamentals, local insights, and professional guidance.
At Premier Home Finders, we don’t just help you buy property—we help you buy wisely. Whether you’re looking to time your next purchase for maximum upside or protect your capital in a cooling market, our suburb-specific expertise ensures you’re always one step ahead.