A rising number of Sydney homes have been sitting on the market for months without selling as government reforms and rate hikes fuel a major pullback in buyer demand.
Figures from SQM Research have revealed an increase in “stale listings” – properties that remain up for sale after more than half a year on the open market – with a 10 per cent rise in these listings recorded over May.
Many of these homes were properties that once attracted huge competition from investors, who have largely retreated from the market since landmark reforms were announced in the May federal budget.
The reforms included the replacement of previous capital gains tax discounts with an indexation system tied to inflation and negative gearing concessions being restricted to new builds.
New SQM data has revealed a 10.2 per cent monthly rise in listings older than 180 days in Sydney. Picture: NCA NewsWire / Max Mason-Hubers
Experts said a significant share of the “stale” listings were also pricier properties that are now out of reach of many homebuyers due to interest rate hikes.
Agents reported many of the vendors of these homes were refusing to budge on prices, despite softer market conditions over recent months.
It comes as PropTrack data showed Greater Sydney prices have fallen by an average of close to 2 per cent since February, with falls of 5-10 per cent recorded in some of the city’s priciest coastal and inner suburbs.
37 Minkara Road, Bayview has been listed since December 2025 according to property records
LJ Hooker head of research Mathew Tiller said there had been a pullback from buyers as they grappled with property tax policy changes.
“We have seen buyers become more cautious and take a little bit longer in their decision making process due to factors like higher interest rates, cost of living pressures and pressures on household budgets,” he said.
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Mathew Tiller
“We’re in for a period of softer market conditions due to higher interest rates and investors pulling back and really trying to get their head around what the tax policy changes mean for them.”
SQM Research director Louis Christopher said some sellers were listing properties with price expectations “potentially well above market”.
“In normal times, with a market rising, eventually these sellers get taken out because the market catches up to their asking price, but in a market which is flat or falling, which is what we are having now, the market doesn’t catch up to the sellers,” he said.
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This York Street apartment has been listed since August 2025 according to property records
“That means that you see an ever increasing number of properties just stay on the market for longer and longer.”
Mr Christopher said some listings had become “stale” even after numerous price adjustments.
“A stigma starts becoming attached to the property that there might be something hidden there,” he said.
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Louis Christopher
“This is a risk for sellers when they price a property above the market, it lingers and lingers – they say that the most likely buyer and the best buyer are the ones that turn up in the first four weeks, I would argue perhaps in the first two weeks.”
Citywide auction clearance rates at the start of June dropped to 41.3 per cent, spotlighting the weakest levels in nearly eight years – and a sharp decline from last year, when more than 70 per cent of properties sold under the hammer most weeks.
Ray White Head of Auctions NSW David McMahon said new vendors should be aware of changing market conditions to make well-informed decisions around the value of their home.
“We now have three to four months of new recent sales data to give them a solid indication of where their property would sit,” he said.
David McMahon
Mr Tiller said many agents over the last couple of weeks have said the properties that are selling are the ones that are “realistically” priced.
He added some of the stock lingering included investor housing stock which is generally some apartment types and locations as well as the top end of the market.
“Probably the upper end of the market as opposed to the prestige market,” he said.
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