To find the best Sydney suburbs to buy units in 2026, we tested every established unit market in the city. Twelve passed all six tests. Ten of them are where we would start looking: Mount Druitt, Wiley Park, Lakemba, Punchbowl, Bankstown, Belmore, Riverwood, Campsie, North Parramatta and Hornsby. Asquith and Northmead also pass. Their units rose only 4.2% and 8.3% in five years, the weakest of the twelve, so we list them separately.
All ten have approved very few new apartments since 2021, and in Sydney that has been a good guide to where unit prices go next. Across the 137 markets with enough flats and sales to measure, where fewer than 5 new apartments per 100 were approved from 2016 to 2021, units rose a median 16.8% over the next five years. At 20 or more, they rose 6.4%. Mount Druitt, Belmore and Bankstown were in that heavy group before 2021. Their units still rose 14.7% to 27.7%, and they have approved almost nothing since.
Five years ago a Lakemba unit cost $146,500 less than one in Merrylands. Their medians are now almost level, $540,000 and $541,000. Since mid-2016 Merrylands has approved 3,127 new apartments, almost as many as the 3,261 flats it had at the 2021 Census. Lakemba has approved 95 in that time.
How we screened 151 Sydney unit markets
We started with the 160 ABS areas of metropolitan Sydney that had 1,000 or more flats at the 2021 Census. Some suburbs span more than one area, so matching them to suburbs and adding a few smaller unit markets gave us 151. Each had to pass six tests.
- Affordable. A median unit price below Sydney’s median unit value of $878,176.
- A real gap to houses. Houses in the same suburb cost at least twice as much. For a lot of buyers, the unit is the realistic way in.
- Little new supply approved. Fewer than 5 new apartments approved for every 100 already there, over the five years to June 2026. The wider area had to stay under 10 per 100 as well. A tower one suburb over still competes for your tenants.
- A tight rental market. Vacancy at or below 1.71%, SQM’s figure for Sydney in August.
- Yield. A gross yield of at least 4.4%, the Sydney average for units.
- Enough sales. At least 50 unit sales in the past year, so the median means something.
Supply knocked out the most markets. Only 64 of the 151 passed it.
10 Sydney unit suburbs with low supply
The two supply columns show new apartments approved for every 100 already there, in the last five years and the five before that. Vacancy is SQM’s August 2026 figure for the postcode, with August 2025 in brackets. Lakemba and Wiley Park share a postcode, as do Hornsby and Asquith, so their vacancy figures match.
| Suburb | Approved per 100, 2021-26 | Vacancy | Gross yield | Unit median | Unit price change, 2021-26 | Approved per 100, 2016-21 |
|---|---|---|---|---|---|---|
| Mount Druitt | 0.0 | 0.65% (0.64%) | 5.42% | $470,000 | +27.7% | 33.4 |
| Wiley Park | 0.8 | 1.40% (1.02%) | 5.24% | $525,500 | +34.7% | 7.0 |
| Lakemba | 0.0 | 1.40% (1.02%) | 5.30% | $540,000 | +41.2% | 2.8 |
| Punchbowl | 0.0 | 1.38% (1.05%) | 4.94% | $578,750 | +10.9% | 18.9 |
| Bankstown | 2.2 | 0.87% (0.77%) | 5.33% | $605,000 | +18.0% | 22.5 |
| Belmore | 1.5 | 1.27% (1.20%) | 4.55% | $662,500 | +14.7% | 26.2 |
| Riverwood | 3.5 | 0.72% (0.86%) | 5.36% | $670,000 | +15.3% | 1.0 |
| Campsie | 0.4 | 0.96% (1.01%) | 4.55% | $685,000 | +10.5% | 5.6 |
| North Parramatta | 1.3 | 0.80% (0.66%) | 4.64% | $694,500 | +13.9% | 4.9 |
| Hornsby | 1.7 | 1.14% (0.76%) | 4.56% | $735,000 | +11.4% | 7.1 |
| Also passed | ||||||
| Northmead | 3.7 | 1.20% (1.54%) | 5.00% | $655,000 | +8.3% | 28.3 |
| Asquith | 1.7 | 1.14% (0.76%) | 5.06% | $719,000 | +4.2% | 63.1 |
North Parramatta and Northmead both pass the wider-area test at 9.9 per 100, the narrowest margin on the list. The Parramatta CBD area next door approved 1,869 apartments in five years.
Campsie, Belmore, Lakemba, Wiley Park, Punchbowl and Bankstown all sit on one rail line. It is the Sydenham to Bankstown line, now being converted to metro. The Canterbury area, which covers all of them except Bankstown, approved 231 new apartments in five years. It already had 18,053. That is about 1.3 per 100, against roughly 11 across Sydney.
Rents rose in all ten over the year, by 3.3% to 7.8%.
Sydney is in a downturn. Cotality has dwelling values 7.1% below their February 2026 peak. Over the year to August, units fell 2.3% and houses 5.5%. Cotality’s research director Tim Lawless says longer selling times, bigger vendor discounts and low clearance rates point to a buyer’s market. The table’s medians cover sales from July 2025 to June 2026, so units today may sell a little below them. Our Sydney property market update has the city-wide numbers.
Sydney unit suburbs that just missed
Several affordable markets failed just one test. These four had the strongest unit price growth over the five years to June 2026.
| Suburb | Missed on | Vacancy | Gross yield | Unit median | Unit price change, 2021-26 |
|---|---|---|---|---|---|
| Cabramatta | Vacancy | 2.00% (1.22%) | 4.99% | $500,000 | +20.5% |
| Warwick Farm | Wider-area supply | 1.12% (1.23%) | 5.53% | $479,800 | +28.5% |
| Penshurst | Yield | 1.34% (1.11%) | 4.36% | $740,000 | +27.6% |
| Mortdale | Yield | 1.19% (0.97%) | 4.21% | $802,875 | +29.9% |
Cabramatta is the strongest of them on supply. It approved 12 apartments in the last five years on top of 2,536, and 16 in the five before that. Its units rose 20.5% in five years and 11.1% in the last one. It missed on vacancy, which has risen four months in a row to 2.00%, above Sydney’s 1.71%. Its postcode also covers Canley Vale, which approved 160 apartments in the same five years. That rental market needs watching before a purchase.
Warwick Farm approved only 10 apartments itself. It failed because the wider Liverpool area approved 10.9 per 100. Most of that came from the new Edmondson Park estate, which approved 520 new apartments where there had been 332. Without Edmondson Park, the Liverpool area would have passed at about 6 per 100. Its postcode does carry more stale stock than Sydney, with 43.1% of listings unsold after 90 days.
Penshurst units grew 27.6% and Mortdale units 29.9%, with almost no new apartments approved in either. They missed on yield. They suit an investor chasing growth more than cash flow.
Most of the other affordable unit markets in western and south-western Sydney, including Fairfield, Liverpool, Canley Vale, Guildford and Granville, failed on supply.
How fast listings sell by postcode
Supply tells you what is coming. Absorption tells you whether buyers are taking what is already for sale. SQM counts every listing in a postcode and how long it has sat on the market, across all dwelling types, not just units. The higher the share still unsold after 90 days, the more room buyers have to negotiate.
| Postcode | Listings unsold after 90 days | Listings vs a year ago |
|---|---|---|
| Mount Druitt 2770 | 25.9% | +66% |
| Lakemba, Wiley Park 2195 | 23.5% | +81% |
| Punchbowl 2196 | 24.5% | +6% |
| Bankstown 2200 | 33.1% | -2% |
| Belmore 2192 | 37.5% | -5% |
| Riverwood 2210 | 30.1% | +14% |
| Campsie 2194 | 35.2% | -18% |
| North Parramatta 2151 | 21.4% | -20% |
| Hornsby 2077 | 36.1% | +14% |
| Sydney | 38.5% | +13% |
| Parramatta 2150 | 47.2% | -4% |
| Liverpool, Warwick Farm 2170 | 43.1% | +14% |
| Merrylands 2160 | 41.6% | +17% |
Every postcode behind the ten has a smaller share of stale listings than Sydney. Parramatta, Merrylands and the Liverpool postcode that includes Warwick Farm all sit above it, from 41.6% to 47.2%. Units in the ten sold in 17 to 27 days on average over the year. Stale listings aren’t one of our six tests, so treat this table as an extra check.
Stock is building in some of them. Listings in the Lakemba and Wiley Park postcode are up 81% on a year ago, from 47 to 85, and Mount Druitt’s are up 66%. More listings give buyers more choice and more room to negotiate. Those two markets are less tight than a year ago, so recheck vacancy and days on market before making an offer.
Small postcodes swing on a handful of listings. Belmore’s figure rests on 40.
Three kinds of low-supply unit market
The 2016-21 column shows what each market approved in the five years before. Those are the apartments most likely to have been finished and rented out since 2021. The ABS counts approvals, though, not completions.
Little supply then or now. Lakemba, Wiley Park, Campsie, Riverwood, North Parramatta and Hornsby approved fewer than 8 per 100 in both periods. Lakemba and Wiley Park posted the two biggest gains on the list. Riverwood’s 15.3% rise only made up a 13.6% fall in the five years to 2021, so its units are about where they were in 2016.
A big earlier wave, still growing. Mount Druitt approved 499 apartments between 2016 and 2021 and none since. Its units rose 27.7%, and vacancy is 0.65%. Bankstown, Belmore and Punchbowl approved 18.9 to 26.2 per 100 between 2016 and 2021, and their units still grew 10.9% to 18.0%.
A big earlier wave, then a stall. The Asquith-Mount Colah area approved 987 apartments between 2016 and 2021, 63 for every 100 it had. Almost all its flats are in blocks of four to eight storeys. Asquith’s units rose 4.2% in five years and took 48 days to sell, against 17 to 27 days in the ten. Northmead’s 28.3 per 100 covers a wider ABS area whose flats are mostly on the Westmead side. It overstates the suburb’s own supply. Northmead itself has about 1,400 flats, and its units rose 8.3%. The draft Westmead South rezoning next door proposes up to 13,000 more homes.
How new supply hits Sydney unit prices
This covers the 137 markets with at least 1,000 flats and 50 unit sales in the year. It compares apartments approved between 2016 and 2021, many of them finished by 2026, with unit price growth from 2021 to 2026. We re-ran it with both periods shifted a year later and got the same pattern.
Markets with heavy supply were far more likely to post a weak result. Two in three of those approving 20 or more per 100 rose less than 10% over five years. For markets approving under 5, it was one in four. The heavy-supply markets had also lagged in the five years before. So part of the gap reflects the kind of suburbs that got the most new apartments.
The pattern has exceptions in both directions. Units in Pyrmont, Darlinghurst and Surry Hills fell even though each approved under 5 per 100 between 2016 and 2021. Penrith approved 2,586 apartments between 2016 and 2021, 76 for every 100 it had. Its units still rose 27.0%, and vacancy there is now 0.64%.
New supply hurts units more than houses. House blocks in an established suburb barely change in number. A rezoning can lift an apartment site from three storeys to twenty. Each new building adds near-identical units that tenants can choose instead of yours. Our five checks for any apartment purchase cover this in more detail. Ten years of Parramatta apartment prices shows supply doing it to one suburb.
What the price gap to houses tells you
Houses outgrew units in 118 of the 127 markets we could measure over the five years to June 2026. Across the ten, house medians rose a median 53.1% in five years. Units rose 15.0%.
Markets that started with a wide gap did see faster unit growth. Where houses cost at least 2.5 times the unit in June 2021, units rose a median 16.6%, against 11.1% where the gap was under two times. But 21 of those 35 wide-gap markets were eastern, north shore or beachside suburbs with units over $1 million. Among markets under Sydney’s median unit price, the gap made no consistent difference.
So we ask for a gap of at least two times and give no credit beyond that. The gap keeps the unit within reach of buyers priced out of houses. A very wide gap today often means the units have lagged, as we found when we ranked 38 Melbourne suburbs by their house to unit gap. Our Melbourne version of this screen caps the gap at two times for that reason.
Where rezoning could add unit supply
The Sydenham to Bankstown metro is due to open later this year. The same corridor has been rezoned. New council planning rules took effect at Belmore and Lakemba in February 2026, under the state’s Transport Oriented Development program. Punchbowl and Wiley Park followed in April. The Bankstown precinct has been zoned for up to 14,000 new homes since November 2024. Campsie’s town centre plan, for 6,360 additional homes by 2036, went to the state for finalisation in June 2026.
Almost nothing has been approved along the line yet, but the new zoning allows thousands more homes. That is the main thing that could change the supply picture for the six Bankstown line suburbs.
Hornsby’s precinct was rezoned for more than 6,000 homes in November 2024. North Parramatta has two precincts on its doorstep. Church Street North allows up to 1,800 homes from July 2024. The Parramatta North precinct, finalised in August 2026, allows around 2,000.
Where new apartments pay to build
Zoning only becomes buildings where the numbers work. The Centre for International Economics tested those numbers for every Sydney council area in a study for NSW Treasury. It measured how far a new block’s sale price clears its full cost plus a 20% developer margin.
In the Blacktown, Parramatta and Hornsby council areas, a mid-rise block falls 2.6% to 4.4% short of that bar. In Blacktown even a 16-storey tower falls short, while in Parramatta and Hornsby towers only just clear it, by 1.8% and 1.2%. In Canterbury-Bankstown, mid-rise clears it by 3.1% and towers by 8.8%. Riverwood straddles Canterbury-Bankstown and Georges River, and in Georges River towers clear it by 22.1%.
Mount Druitt sits in the Blacktown council area. Its town centre was rezoned for mixed use and taller buildings in May 2020. No apartments have been approved there since the 441 approved in 2019 and 2020. The ABS figures do not show how many of those were built. Before buying in Mount Druitt, check the council’s application tracker for approved town centre projects that have not started.
Cost holds back supply most around Mount Druitt. In Parramatta and Hornsby only towers pay, and both have large rezonings near these suburbs. Along the Bankstown line and around Riverwood, towers already pay comfortably.
What to check before you buy a unit
The suburb data gets you to a shortlist, but the building you pick decides how the purchase performs.
- The block. A walk-up or villa in a small block carries more land per unit than a tower apartment. In Lakemba, 93% of flats are in blocks of three storeys or fewer. In Bankstown, we would look at low-rise stock outside the rezoned precinct.
- Strata costs. Levies come straight out of the yield. Get the last four quarters of levies and the capital works fund (sinking fund) balance before you offer. Our body corporate fees guide covers what a healthy fund looks like.
- Sites nearby. Check the council’s tracker for development applications within a few hundred metres. The NSW Planning Portal shows the zoning around the station.
- Vacancy direction. Compare two readings a year apart. Vacancy rose over the year in most of these suburbs, as it did across Sydney (1.38% to 1.71%). It fell only in Riverwood, Campsie and Northmead.
- The yield you will get. Hornsby clears the 4.4% bar at 4.56% on our calculation. On the figure Your Investment Property publishes, it misses at 4.38%. Work out the yield from the rent and price of the actual unit.
Where a unit fits in a portfolio
We start most portfolios with an established house on a decent block. Land is where most of the growth sits. Houses in these ten suburbs cost $1,072,500 to $2,150,000. The units cost $470,000 to $735,000 and yield 4.55% to 5.42%. The typical Sydney house yields 2.9%.
A unit makes sense when borrowing is tight, when a portfolio needs cash flow, or as a way into Sydney below the $1.5 million median house price. Our capital growth versus rental yield piece covers the trade-off, and our house or unit guide has the long-run record.
When we buy units for clients in Sydney, we look for older low-rise blocks in markets like these. Our Sydney buyers agent page covers how we buy across the city.
Supply is the test to run first
Across 137 Sydney unit markets, the ones that approved the most new apartments grew the least. These ten are affordable, yield at or above the Sydney average for units and have approved little new supply so far. Along the Bankstown line the new zoning allows far more, so watch building approvals there first, and vacancy after that.
Data sources. Unit and house medians, weekly rents, sales counts and days on market are Cotality (formerly CoreLogic) figures accessed through Your Investment Property. Medians and sales are to 30 June 2026 and rents to 31 August 2026. Every yield is computed by us as weekly rent times 52 divided by the median. Five-year changes compare the June 2021 and June 2026 annual medians. Cotality’s “units” include villas and townhouses on strata as well as apartments. New apartments per 100 is ABS Building Approvals by SA2 (new apartments only, townhouses excluded) divided by occupied flats and apartments at the 2021 Census, summed across the SA2s that best match each suburb. The 2021-26 figures are FY2022 to FY2026 and the 2016-21 figures are FY2017 to FY2021 from the ABS 2016-21 SA2 series, both on 2021 boundaries. For North Parramatta and Northmead the matching SA2 is two to three times the size of the suburb, taking in parts of Parramatta and Westmead. The wider-area test uses the SA3. Vacancy is SQM Research by postcode, which covers all rental dwellings, August 2026 against August 2025. Stock on market is SQM’s total listings by postcode for August 2026 against August 2025, all dwelling types, with the 90-day share taken from its listing-age breakdown. Lakemba and Wiley Park share postcode 2195, and Asquith and Hornsby share 2077. City-wide values and yields are the Cotality Home Value Index to 31 August 2026, and the Sydney vacancy benchmark is SQM’s. Feasibility is from the CIE’s 2025 cost and feasibility estimates for NSW Treasury, published July 2026. Rezoning details are from the NSW Department of Planning, Housing and Infrastructure, Canterbury-Bankstown Council and Blacktown Council. All figures pulled 29 September 2026.
This is general information only and not financial advice. Speak to a qualified professional before making investment decisions.
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