10 best suburbs to invest in Sydney in 2025

Analysis suggests another moderate year for Greater Sydney’s property markets. Its sales activity is good and rents are delivering significant growth, but Australia’s biggest and most expensive capital city is doing poorly in other areas.

For example, Sydney is one of Australia’s worst areas for vacancy rates and infrastructure investment per capita, and recent price performance has been lukewarm.

Affordability is a recurrent problem for this very expensive market, and Sydney has been on the wrong end of the ‘exodus to affordable lifestyle’ trend for several years; it loses population every year as people relocate to other parts of Australia, though it does benefit from overseas migration.

The data below was prepared in February 2025 with suburb median prices, growth rates, vacancy rates and median rental yields provided by Hotspotting by Ryder and initial outlay and monthly repayments calculated by Canstar Research.

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Top 10 best suburbs to invest in Sydney in 2025

• Dee Why (U)
  
• Fairfield (U)
  
• Kingswood
  
• Lurnea
  
• Mount Druitt
  
• Regents Park
  
• Penshurst
  
• Villawood
  
• Warwick Farm (U)
  
• Wiley Park(U)
  

Dee Why (U)

Good real estate options under a million dollars are rare in the Northern Beaches area, as are yields above 4%, but bayside Dee Why may be able to offer some promising possibilities. With over 600 apartment sales in 2024, typically selling in three weeks, it demonstrates the strength of this location in an otherwise patchy Sydney market. Vacancies at 0.4% and an 8% rise in unit rents in the past year also indicate rental demand is strong.

Fairfield (U)

Fairfield, located between Parramatta and Liverpool, has a convenient commuter train station and amenities such as the Fairfield City Central shopping centre. The average house in Fairfield fetches around $1.2 million but the median unit price is just $460,000. This offers home buyers a rare affordable option in the Greater Sydney market and investor yields close to 6%, with rents having increased almost 20% in 2024.

Kingswood

The City of Penrith is the best located LGA to benefit from the multi-billion-dollar investment in the new Western Sydney Airport and associated infrastructure. Kingswood is particularly well-located on the commuter rail line and at the A9/A44 intersection, with two Western Sydney University campuses. House prices rose 9% in 2024, maintaining the suburb’s solid long-term average, and house rents rose 14%.

Lurnea

The statistics for Lurnea depict a market with strong demand, with locational factors at heart. Lurnea benefits from the amenities of the nearby Liverpool CBD, the intersection of the M5 and A28, and the green space corridor that bisects the suburb. Its median house price rose 15% in 2024, nudging the $1 million mark and maintaining the suburb’s strong long-term average, while rents increased 13%.

Mount Druitt

One of the major hubs for western Sydney, Mount Druitt has the Blacktown Mt Druitt Hospital, a major TAFE campus, Westfield Mt Druitt Shopping Centre and a commuter train station. Proximity to the Western Sydney Airport project may also affect this market in the future. Mt Druitt’s median house price rose 11% in 2024 and is now approaching the $1 million milestone, though units (median $430,000) offer a cheaper alternative.

Penshurst (U)

Penshurst offers residents access to a commuter train station and Aquatic Leisure Centre, and sits beside the regional hub of Hurstville—which has two major shopping centres. It’s also part of the Georges River LGA, considered a middle-market precinct where buyer demand is growing and homes are selling in around three weeks. The median house price in Penshurst is $1.8 million but apartments are less than half that figure, and unit sales outnumber house sales two to one.

Regents Park

This low-profile suburb in the Cumberland LGA near Parramatta is accessed via a train station at the intersection of two commuter rail lines. Amenities include the Carnarvon Golf Club and a Leisure & Aquatic Centre. Regents Park also has one of Sydney’s best capital growth records, averaging 14% a year over five years, which it has maintained in 2024. Rents rose 8%, supported by vacancies well below the Sydney average.

Villawood
This suburb in the popular Canterbury-Bankstown LGA grew its median house price by 20% (topping $1 million) and its median house rent 25% in the past 12 months—supported by a 1% vacancy rate (well below the Sydney average) and consistent buyer demand. Three commuter train stations are within reach and offers extensive green space, including Boggabilla Reserve and two golf clubs.

Warwick Farm (U)

This affordable location offers frontage to Georges River, proximity to Liverpool Hospital and the Liverpool CBD amenities, commuter train links and affordable units (median price $445,000). For investors, vacancies are below the Sydney average and unit rents rose 19% in 2024, with yield typically above 6%.

Wiley Park (U)

Wiley Park is part of the Canterbury-Bankstown LGA, which is consistently popular thanks to its relative affordability and solid location. The suburb has commuter rail links and the large green space area from which the suburb takes its name. Wiley Park’s median unit price rose 11% in 2024 (with units typically selling in three weeks), with unit rents up a similar amount, indicating solid demand.

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Best suburbs to invest in Sydney 2025

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Source: www.canstar.com.au. Prepared in February 2025. Based on a selection of suburbs’ median prices, growth and rent figures provided by Hotspotting by Ryder. Initial outlay figures include the deposit, stamp duty, mortgage registration and transfer fees; and lenders’ mortgage insurance (LMI) premium for the 10% deposit scenarios. Stamp duty calculated based on an owner occupier purchase of an established dwelling where applicable. FHB concessions include stamp duty only. LMI premium based on Helia LMI Premium Calculator for an owner occupier borrower and a loan term of 30 years. Monthly repayments calculated based on the interest rates of 6.20% (20% deposit) and 6.34% (10% deposit) and a loan term of 30 years. Interest rates based on the RBA Lenders’ Interest Rates (November 2024). Percentage of income based on the average total income by Greater Capital City Statistical Area (ABS Personal Income, 2021-22), adjusted by the ABS Wage Price Index (Sep-2024) for each state.

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What are some of the factors that are affecting the Sydney market?

Sales volumes

Sydney experienced solid sales activity last year, resulting in moderate growth in both house and unit prices. The market overall remains fairly positive with steady buyer demand.

Quarterly price growth

Around 34% of Sydney’s suburbs recorded price growth above 2% in the quarter under review. Combined with the city’s sales volumes, it suggests that any price growth in the Sydney market in 2025 will be moderate.

Vacancy rates

Vacancy rates have been the weakest sector for the Greater Sydney market for some time. Sydney has a relatively high overall vacancy rate of close to 2% at the end of 2024, with only a quarter of its suburbs having vacancy rates below 1%.

Rental growth

Despite its poor vacancy rates, Sydney has relatively strong rents, with 80% of suburbs recording 5%-plus growth in the past year. Sydney’s wealth and high incomes support strong rent rises.

Infrastructure spending

Sydney is investing big in infrastructure, particularly transport links, with the Western Sydney airport a big influence. There are also multiple billions of dollars going into medical, educational and commercial developments. However, the $66 billion in projects that got under way in 2024 is small relative to the city’s population, and well below Melbourne’s commitments when compared to another Australian major capital city.

Cover image source: Martha Almeyda/Shutterstock.com