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July 17, 2026 — 5:00am
Alongside State of Origin, Sydney’s roaring property market has been a favourite conversation starter with interstate friends for decades.
But Sydney’s owner-occupier rate has now slumped below 60 per cent, leaving us with little to brag about, since the decline is also dragging down the owner-occupier rate for the whole nation.
The drop is further proof that the Australian dream is slipping from the grasp of new generations of Sydneysiders, pushing many to abandon the state or remain at the mercy of a soaring rental market.
As the Herald’s Matt Wade reports, analysis by consultancy KPMG shows Greater Sydney’s owner-occupier rate hit 59.9 per cent in 2025, down sharply from 68.4 per cent in 2021. It’s the lowest mark since the 1950s.
The drop came despite a range of generous government programs designed to support first-time buyers.
Notably, the fall in owner-occupier rates was not repeated in other capitals; Melbourne’s owner-occupier rate was steady at 67.4 per cent between 2021 and 2025, while the share of owner-occupiers rose in Queensland and Western Australia.
Yet 15 years ago, the owner-occupier rate in Sydney was the same as the rest of the country at 68.4 per cent. Life was much easier for renters back then: in 2011, three out of 10 Sydney households were tenants. Today, it’s about four in 10 households.
Sydney’s residential property market has long had the volatile overtones of a collision between Australian home ownership and investors. In the 1980s, foreign investors started to drive up prices and a decade later, values were supercharged by a 50 per cent capital gains tax discount and negative gearing. Admiring media coverage of the wealthy and celebrities trousering millions by selling trophy mansions also helped inflate the market to bursting point. Some air has escaped of late.
KPMG urban economist Terry Rawnsley said the latest data showed affordability was redrawing Australia’s housing map. In Sydney, people are not only moving to the regions searching for cheaper housing, but Australian Bureau of Statistics data showed more than 104,000 had gone interstate in 2025.
There are positive signs for boosting homeownership. Amid attempts by governments to address the housing crisis, the number of dwellings under construction reached a record 243,900 in the March quarter, up from 220,300 a year earlier.
Sydney is consistently ranked among the world’s most expensive cities.
These latest statistics reveal the downside of pricing out regular home buyers and turning our suburbs into childless ghettoes. The mood of the public has changed: three recent opinion polls show large numbers of Australians think house prices have to fall.
The Albanese government last month passed legislation that introduces a less generous method for calculating capital gains taxes as well as curbing negative gearing.
While it’s too soon to determine exactly what effect this policy will have, the truth is significant intervention is needed to reshape the housing market to ensure owner-occupiers are not outnumbered by investors and young people are forced to choose between a soaring rental market or deserting the state altogether.
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