Source : the age
Home discounting is becoming more prevalent across Sydney, new data reveals, which is putting buyers in a better negotiating position, but some areas are bucking the trend.
Domain’s Market Insights Report examined houses that sold via private treaty in the six months to May and compared the listing price with the eventual sale price. Sales were grouped by statistical area, as defined by the Australian Bureau of Statistics.
The Sydney Inner City area, which includes Surry Hills and Redfern, recorded the highest rate of discounting, with 10.7 per cent of houses transacting below the listing price. Year-on-year, discounting was up 34.4 per cent.
Next was the Pittwater area, which includes Mona Vale and Palm Beach. There, 9.9 per cent of houses were sold at a reduced price, and discounting increased 4.3 per cent year-on-year.
The Strathfield-Burwood-Ashfield area was third, with 9.6 per cent of houses transacting at a discount. Year-on-year, discounting was up 23.9 per cent.
Citywide, in the three months to May, 6.5 per cent of all houses transacted for less than the listing price, and discounting was at an eight-month-high.
Dr Nicola Powell, Domain’s chief residential economist, said the trending direction of discounting was a reliable indicator of the health of the property market.
“The vast majority of transactions in Sydney are private treaty, which is why this stat is a good litmus test for the market.”
Powell said the increase in discounting indicated the Sydney market was “slowing down” as properties languish and vendors resort to price cuts to clinch deals.
“One of the things that this discounting data really says is that buyer leverage is increasing. We know that supply is rising, we know that demand is falling, and that puts active buyers in a better position to negotiate.”
While most greater Sydney areas recorded higher rates of house discounting than May 2025, several districts recorded a sharp fall, including Canterbury, down 39 per cent; Penrith, down 23 per cent; and Liverpool, down 22.5 per cent.
Powell said plummeting discounting rates in Sydney’s more affordable regions underscored the fact that, even in a downturn, the city remained an incredibly expensive place to buy property.
“The demand that does exist is being steered towards the affordable segments. When you’ve got areas like Mount Druitt with lower discount rates than this time last year, it says a lot about affordability pressures.”
Anthony Landahl, mortgage broker and managing director of Equilibria Finance, said many of his clients were taking advantage of current market conditions to secure discounts.
“We’re definitely seeing clients successfully securing properties at prices they couldn’t have got six to 12 months ago.”
Entry-level properties were less likely to be discounted than more expensive homes, Landahl said.
“There’s a real split in the market and in sentiment. The lower quartile, under the $1.5 million mark, remains quite competitive, but at the higher end there’s a growing tension between vendors’ asking prices and what buyers are willing to pay.”
Westpac senior economist Matthew Hassan said a lack of certainty about the federal government’s proposed changes to negative gearing and capital gains tax, coupled with concern about interest-rate movements and the economy, were causing investors and owner-occupiers alike to freeze.
“There’s a bit of paralysis in the market. People are very unsure about how all of this plays out in the medium to longer term.”
Vendors with an urgent need to transact had few options available to them other than discounting, Hassan said.
“In that sense it is now a buyer’s market. The caveat is that supply is still relatively tight compared to the market’s longer-run history, but for now it is exceeding demand.”
Michael White, an agent at Adrian William Real Estate who specialises in Newtown and Surry Hills, said competitively priced properties were still selling well.
“Properties are selling at different paces. It depends on whether the vendor is accepting of the reality of how the market has shifted. It’s not a market where they can hold onto last year’s prices.”
White said he had handled several properties this year that transacted when the vendor agreed to lower the asking price. Other sales proceeded when the vendor agreed to contract amendments.
“In a transitional market it’s easier for buyers to ask for those amendments, whether it’s a longer settlement or deposit changes. As a buyer you can be a little bit calmer in your approach in a market like this, and hold out for the terms you want.”
White said he thought the current market conditions would persist for some time.
“I’ve been encouraging people to step into this market because it’s a market where you can do many things more easily and better, like sideways transitions or upsizing. That said, buyers have time on their side. They don’t need to rush.”
Dan F Stapleton writes on First Nations issues, visual art, property and more. His writing has appeared in The New York Times, the Financial Times and others. He is based in Sydney.
