Is Sydney a buyer's market in 2026?
Sydney dwelling values sit 5.0 per cent below their January 2026 peak and auction clearance rates have fallen to the low 50s. Weaker conditions change what a buyer's agent is actually for.
Sydney is a buyer's market in 2026. Cotality's daily dwelling value index had Sydney values 5.0 per cent below their January 2026 peak as at 30 July 2026, and Cotality's final auction results put Sydney's clearance rate at 53.3 per cent for the week ending 26 July 2026, against a combined capitals rate of 68.5 per cent a year earlier.
What does a buyer's market in Sydney look like in 2026?
A buyer's market is one where supply, time and negotiating leverage sit with the purchaser rather than the vendor, and Sydney now meets that description on every measure that matters. Cotality's Home Value Index recorded Sydney dwelling values falling 1.2 per cent in June 2026 and 3.2 per cent over the June quarter, with a median dwelling value of $1,265,608. Cotality's daily index then showed a further 1.4 per cent fall across July 2026, taking the rolling quarterly decline to 3.7 per cent.
The auction market has moved in the same direction. Domain reported on 22 June 2026 that Sydney's clearance rate had fallen to 47 per cent, the lowest in five years, against 69 per cent at the same point in 2025, with roughly 24 per cent of scheduled auctions withdrawn. Cotality's Monthly Housing Chart Pack for July 2026 recorded the median vendor discount across the combined capitals widening to 3.6 per cent over the four weeks to 5 July 2026, and the share of sales transacted by auction falling from close to 45 per cent in November 2025 to just over 30 per cent in June 2026, led by Sydney and Melbourne.
Why has the Sydney market turned?
Two policy shifts explain most of the change in Sydney conditions through the first half of 2026. The Reserve Bank of Australia raised the cash rate target at three consecutive meetings in February, March and May 2026, taking it from 3.60 per cent to 4.35 per cent effective 6 May 2026, and the RBA's May statement cited inflation that “picked up materially in the second half of 2025” with risks tilted to the upside. Borrowing capacity contracted accordingly and the buyer pool thinned, which is the mechanism behind Sydney's weaker auction clearance rates through 2026.
The second shift is tax. The 2026-27 Federal Budget restricted negative gearing on established residential property, so that from 1 July 2027 net rental losses on established homes acquired after 7.30pm AEST on 12 May 2026 can only be offset against rental income or residential capital gains rather than against salary. Newly built property is exempt, and property acquired before that date is grandfathered. The Australian Bureau of Statistics recorded 57,342 new investor loan commitments nationally in the March quarter 2026, down 5.3 per cent on the December quarter, with total new housing loan commitments of $103.0 billion, down 3.8 per cent over the quarter.
Sydney market conditions, mid-2025 against mid-2026
| Measure | Mid-2025 | Mid-2026 |
|---|---|---|
| Sydney auction clearance rate | 69% (June 2025) | 47% (June 2026), 53.3% (week ending 26 July 2026) |
| Combined capitals clearance rate | 68.5% (July 2025) | 49.7% (week ending 26 July 2026) |
| Sydney dwelling values | Rising through 2025 to a January 2026 peak | -3.2% (June quarter 2026), -5.0% from peak to 30 July 2026 |
| RBA cash rate target | 3.85% (June 2025) | 4.35% (from 6 May 2026) |
| Median vendor discount, combined capitals | Narrower | 3.6% (four weeks to 5 July 2026) |
| Negative gearing on established homes | Unrestricted | Restricted from 1 July 2027 for purchases after 12 May 2026 |
What is a buyer's agent, and does a falling market change the case for one?
A buyer's agent in NSW is a licensed real estate agent who is engaged by, and acts only for, the purchaser, handling the search, the appraisal of value, the due diligence and the negotiation or auction bidding. Buyer's agents in NSW operate under the same licensing regime as selling agents, administered by NSW Fair Trading under the Property and Stock Agents Act 2002 (NSW), and a buyer's agent cannot act for the vendor in the same transaction.
The case for engaging a buyer's agent does change in a softer market, though not in the direction most people assume. In a rising market the value of a buyer's agent sits largely in access and speed, because the constraint is finding a property before someone else does, whilst in the Sydney market of 2026 the constraint has moved to pricing and negotiation, because Cotality's data shows more auctions withdrawn and vendors accepting wider discounts. Whether a buyer's agent is worth the fee now turns on how well that agent reads a falling market rather than how quickly they find listings.
Five things worth testing before you engage a buyer's agent in 2026
What to ask for before you sign
- The last five purchases completed since March 2026, with suburb and price against the vendor's asking price
- A stated approach to withdrawn and passed-in stock
- The total fee in dollars, and whether it is fixed or a percentage of purchase price
- An unprompted explanation of the 1 July 2027 negative gearing change, if you are investing
- The specific suburbs they transact in, not the regions they cover
What this means for NSW buyers over the next six months
Weaker Sydney conditions reward preparation rather than urgency. With roughly a quarter of Sydney auctions withdrawn in June 2026 and the median vendor discount across the combined capitals widening to 3.6 per cent, buyers who take a couple of extra weeks to get finance, inspections and a clear price ceiling in place are unlikely to be punished for it the way they would have been in 2024.
Common questions
Is 2026 a good time to buy property in Sydney?
Sydney dwelling values fell 5.0 per cent from their January 2026 peak to 30 July 2026 on Cotality's daily index, which improves entry pricing but also signals further downside risk. Whether it suits you depends on your holding period, your borrowing capacity at the 4.35 per cent cash rate set by the Reserve Bank of Australia in May 2026, and whether you are buying to occupy or to invest.
How much does a buyer's agent cost in NSW?
Buyer's agent fees in NSW are charged either as a fixed engagement fee or as a percentage of the purchase price, and many agencies also charge a smaller upfront retainer at the start of the search. Buyer's agent pricing is not regulated in NSW and varies widely between agencies, so ask for the total cost in dollars rather than a percentage, and confirm what the fee covers.
Do buyer's agents need a licence in NSW?
Yes. A buyer's agent in NSW must hold a real estate agent licence or certificate of registration issued by NSW Fair Trading under the Property and Stock Agents Act 2002 (NSW). You can check any agent's licence status on the NSW Fair Trading public register before engaging them, and it is worth doing, because the register also shows disciplinary action.
Will the negative gearing changes affect a property I buy now?
Yes, if it is an established residential property. Under the 2026-27 Federal Budget measures, established residential property acquired after 7.30pm AEST on 12 May 2026 loses the ability to offset net rental losses against non-rental income from 1 July 2027. Newly built property is exempt, and property acquired before that date is grandfathered. Confirm your position with your accountant.
What does Foleo charge buyers?
Foleo is free for buyers. There is no fee, no obligation, and you can stop the process at any point. Foleo earns a referral fee from matched agents when an engagement proceeds, and that fee does not affect the fee you pay your buyer's agent. Foleo is a referral and matching service, not a licensed real estate agent or financial adviser.
Find the right buyer's agent for a falling market.
Tell us your strategy, budget and timeline. We'll hand-match you to two to four independently vetted NSW buyer's agents, then step out of the way.
Find my match