Luxury Suburbs Drive Sydney and Melbourne Rebound

Luxury Suburbs Drive Sydney and Melbourne Rebound

House prices in Sydney’s lower north shore and inner Melbourne are making a strong comeback, with values climbing up to 2% over the past three months. This surge is particularly noteworthy in high-end suburbs, which previously experienced the steepest declines when the market softened.

The recovery has been fuelled by a recent interest rate cut, which has boosted buyer confidence and improved borrowing capacity. Wealthier suburbs like Cremorne in Sydney and Fitzroy in Melbourne have led the turnaround, reflecting a broader trend where premium markets are responding faster to economic shifts.

In Sydney, homes in Crows Nest saw the sharpest rebound, climbing 2.1% in the past three months after falling 7% in the previous quarter. Nearby Mosman recovered 1.4%, while Artarmon and Balmain East also posted gains. In Melbourne, Fitzroy rose by 0.3%, while Prahran and Windsor saw stronger recoveries of 1.1% and 1.7%, respectively.

This upswing suggests the luxury housing market is on firmer footing, though prices in many areas remain below peak levels. In Sydney, suburbs like Cremorne and Balmain East are still down by over 7% from their highs, while Melbourne’s Fitzroy and Prahran remain more than 8% below peak values. While sentiment has improved, uncertainties remain around how sustained this recovery will be.

Source: Australian Financial Review, Skynews, API Magazine