Why Sydney Houses Are Outpacing Units — But Apartments Are Making a Comeback

New data from CoreLogic reveals a striking shift in Sydney’s property landscape: the price gap between freestanding houses and apartments has soared to a record high. As of 2024, the average house in Sydney is priced 86% higher than a typical unit, marking the steepest premium in decades.

Why Are Houses Outperforming Units?

The preference for houses has been driven by several interrelated factors, most of which accelerated after COVID-19:

Lifestyle Shifts Post-Pandemic

Lockdowns reshaped what Australians want in a home. There’s now heightened demand for:

• Outdoor areas for children, pets, and entertaining

• Home offices and flexible layouts for remote work

• Privacy and separation from neighbours

• Scope for renovations, granny flats, or duplex development

This is especially true in well-established suburbs where family homes on decent-sized blocks are in high demand due to proximity to schools, transport, parks, and shopping.

Limited House Supply

While many new unit complexes continue to be built across Greater Sydney, land supply for freestanding homes remains constrained. Detached houses in inner and middle-ring suburbs are becoming increasingly scarce, adding to their value.

Higher Capital Growth and Stronger Tenant Demand

Houses typically deliver better capital growth over the long term, which appeals to investors. They also attract longer-term tenants such as families, which helps reduce vacancy rates and improves rental stability.

But Don’t Count Out Units Just Yet

Despite the dominance of houses, units are beginning to reclaim ground, particularly in well-positioned areas. Here’s why:

Affordability Crunch Is Pushing Buyers to Units

With Sydney’s median house price well above $1.6 million, many first-home buyers, downsizers, and investors are turning to more affordable units, which often offer better rental yields and lower entry prices.

Renewed Migration and International Students

Sydney is once again welcoming large numbers of overseas migrants and international students, particularly around universities and city fringe locations. This is reviving rental demand for apartments in areas like:

• Parramatta

• Strathfield

• Ashfield

• Inner West and City Fringe suburbs

Improved Design and Amenities in Newer Units

Modern apartment developments now offer:

• Smart layouts with work-from-home spaces

• Shared facilities like rooftop gardens, gyms, and co-working areas

• Better energy efficiency and security features

These appeal to young professionals and downsizers seeking convenience and lifestyle in walkable, connected communities.

The Bottom Line for Buyers and Investors

Houses remain the premium product — especially in suburbs with strong owner-occupier appeal and limited land supply. But as the affordability gap widens, strategically located units present an excellent opportunity for investors and first-time buyers to enter the market.

For landlords, this means: Detached homes will likely remain in strong demand and attract premium rents and Units in the right locations are seeing a renter resurgence — with better returns in suburbs near CBDs, universities, and major transport hubs

Final Thoughts

Sydney’s property market is evolving — and whether you’re a landlord, buyer, or investor, staying informed is key to making the right decisions. While houses continue to deliver strong long-term growth and broad appeal, units are showing clear signs of a comeback in select areas where affordability, lifestyle, and demand intersect.

If you're considering your next move — whether it's upgrading to a house, entering the market with a unit, or reviewing your investment strategy — I'm here to help with local insights and tailored advice.

Feel free to reach out any time for an up-to-date appraisal, rental review, or market overview in your area.