Sydney suburbs where homes earned their owners $500k+ after only five years

Homeowners are living atop a gold mine in parts of Sydney due to huge price rises, with owners in a quarter of suburbs gaining $500,000 equity in the last five years alone.

Homeowners are living atop a gold mine in parts of Sydney because of jaw dropping property value rises, with owners in a quarter of suburbs gaining $500,000 equity in the last five years alone.

Many of the biggest value rises were for houses on larger blocks in a range of suburbs more than 20km from the CBD, new PropTrack analysis showed.

Homeowners also had spectacular equity gains in some coastal suburbs that became a popular alternative to Sydney’s affluent east during the early Covid years.

Suburbs with the highest house value gains over the past five years – more than $1m – included northwest suburbs Glenorie, Glenhaven and Putney, along with northern beaches suburbs Fairlight, Balgowlah and Freshwater.

There were an additional 22 suburbs where home values rose by an average of more than $1m and 96 suburbs where the increase was over $500,000 – representing a quarter of areas with available data.

Dara Vongsonephet and Giorgio Lucchini with son Leonardo and dog Roger, are selling their Earlwood unit. Picture: Tim Hunter.

The average gain for houses across the Greater Sydney area, which includes the Central Coast and Blue Mountains, was 36 per cent over the five years, while unit owners had only marginal average gains of 3.2 per cent.

PropTrack economist Angus Moore said the rapid equity gains in some areas created considerable wealth for many families.

“There is a wealth effect,” he said. “Those households will be a lot more confident in their spending and they will be able to use that equity to upgrade their home sooner than they may have expected.”

He added that this was one of the reasons home prices were continuing to rise despite interest rate rises reducing buyers’ borrowing capacity.

Prices are now about 5 per cent higher than they were at the start of the year, according to PropTrack’s monthly Home Price Index.

“A significant share of buyers are taking out loans worth less than 60 per cent of their property’s value,” Mr Moore said.

“These buyers a lot more insulated from interest rate rises than many first homebuyers who are using small deposits.”

Adrian Tsavalas, the director inner west agency Adrian William, said homeowners were often surprised by how much their homes were worth given the negativity around interest rate rises.

He said those who owned modern or fully-renovated houses were in a particularly strong position as their properties were highly sought after and the supply of new houses was falling.

“There is reluctance in the market to do renovations,” Mr Tsavalas said.

“Turnkey homes are extremely sought after but the supply is really low so they are selling for very high prices at auction.

“Recently it’s often a lot higher than what comparable sales from previous months would have suggested.”

Dara Vongsonephet, with partner Giorgio Lucchini, recently bought a new house in Tempe and is selling her Earlwood unit on Homer St at auction on August 19. She said price increases in the area were huge.

“Prices have gone up a lot,” she said. “We bought in 2016 and it feels like it’s competitive now as it was then.”

Originally published as Sydney suburbs where homes earned their owners $500k+ after only five years