Should you help your children buy property in Sydney right now?
Photo by Neil Thomas on Unsplash - is it time to support your adult kids’ growth?
Amongst only those lucky enough to be in that position, the conversation comes up constantly. A son or daughter is renting in the Eastern Suburbs or Lower North Shore, paying $600+ a week for a bedroom in an apartment their grandparents could have bought for $180,000. The parents have equity, liquidity, and the capacity to help. The question isn't really "can we?" — it's "should we, and should we do it now?"
Right now, that question has more moving parts than usual. Sydney's property market is in a genuine soft patch. Interest rates are higher than anyone anticipated twelve months ago. But rents show no sign of retreating, government policy is actively subsidising entry into the sub-$1.5m bracket, and the supply pipeline for Eastern Suburbs and Lower North Shore apartments remains structurally thin.
Here's what the data says — and what I'm actually observing on the ground.
"The market is softer. But softer doesn't mean broken — and for buyers with genuine capacity, soft markets are where the best long-term decisions get made."
Where the market sits right now
Let's be honest about the conditions. Sentiment has massively shifted.
– Sydney dwelling values fell 0.6% in April 2026 and are now sitting around 1% below their November 2025 peak. (CoreLogic)
– The RBA raised the cash rate three times this year — to 3.85% in February, then 4.10% in March and 4.35% in May. Three consecutive hikes, but another in June looks less likely.
– ANZ has revised its Sydney growth forecast to 2–3% for 2026, down sharply from earlier projections. Westpac expects a decline of 3%.
– In the Eastern Suburbs and Lower North Shore, premium houses are the most affected. Buyer selectivity has increased significantly, and vendors who came to market expecting 2025 conditions have had to recalibrate.
– Auction clearance rates across Sydney have softened materially — with more vendors switching to private treaty or expressions of interest as the reality of the current market sets in.
For parents thinking about assisting a purchase, this is context, not cause for alarm. Price corrections in trophy markets are historically temporary. What matters more is what you're buying, at what price, and whether the fundamentals of that specific location remain intact.
Sources: CoreLogic April 2026; ANZ market commentary; Westpac Housing Pulse Report; SQM Research
"ANZ has cut its Sydney growth forecast to 2–3% for 2026. Three rate hikes in four months will do that. But the structural case for tightly held Eastern Suburbs and Lower North Shore property hasn't changed."
The case for acting now (the pros)
Despite the soft headline numbers, there are real arguments for helping your children get into the market in 2026.
1. Prices have come off — and competition is thinner
When clearance rates soften and vendor confidence dips, the buyers who remain active face less competition. For a well-structured offer on the right property, this is a better environment than the last few years. Your children are not competing against eight other bidders at auction who have all abandoned their due diligence.
2. Rents are punishing — and are set to get worse
This is the number that should concentrate the mind of any parent watching their child hand over more and more rent.
– CBRE's March 2026 Apartment Vacancy, Rent and Price Outlook forecasts a 27% increase in median apartment rents across Australian capital cities by 2030.
– Sydney's Eastern Suburbs has a vacancy rate sitting below 1% — one of the tightest rental markets in the country according to SQM Research.
– Eastern Suburbs 2-bedroom apartments are currently commanding $1,000–$1,500 per week in median weekly rent.
– CBRE specifically identifies Sydney's Eastern Suburbs and Lower North Shore as where the sharpest further tightening in vacancy rates is expected.
Every week in rent is dead money. Every year of delay is another year of wealth transfer to a landlord — not to your adult kids.
3. Government policy is creating a genuine floor under sub-$1.5m purchases
Since October 2025, the Federal Government's 5% Deposit Scheme (formerly known as the Home Guarantee Scheme) has been expanded materially:
– Income caps have been removed entirely —now accessible regardless of earnings.
– Places are now unlimited — no more allocation quotas closing in June.
– Sydney's property price cap has been raised to $1.5m — which for the first time makes the scheme genuinely relevant to Eastern Suburbs apartment buyers.
The practical effect: a buyer purchasing a $1.2m apartment in Randwick or Neutral Bay now needs only a $60,000 deposit — versus $240,000 under standard lending criteria, without having to pay Lender’s Mortgage Insurance. This is concentrating substantial first-home buyer demand into the sub-$1.5m bracket, which is creating a policy-supported floor under that price band.
If your child is looking at properties in this band, they are now competing with a larger, more government-enabled buyer pool. Waiting may not improve the entry point as much as the overall market softness might suggest.
Sources: CBRE Apartment Vacancy, Rent and Price Outlook, March 2026; SQM Research; Urban Renters Agent 2026; Housing Australia, October 2025 expansion; Finance Craft, March 2026
4. Long-term supply fundamentals remain unchanged
The Eastern Suburbs and Lower North Shore are geographically constrained, politically resistant to high-density development, and persistently desirable. New supply is structurally insufficient against long-run demand. The case for owning quality real estate in these markets over a 10+ year horizon has not been undermined by two RBA rate decisions.
The clear and present risks - the cons
Any adviser worth their fee will tell you there's a real case for pause too. Here it is plainly.
1. Rates could go higher
Nobody forecast two consecutive hikes going into 2026. The RBA has demonstrated it is willing to move. If there is a third hike, serviceability pressure on over-leveraged buyers would increase further — and further price softening in the premium end is possible. If your child's financial position is tight, this matters.
2. The premium market may not have finished correcting
Sydney dwelling values are 1% below their November 2025 peak — that's a modest correction so far. Historically, softening cycles in the premium end can run 12–18 months and produce 5–10% peak-to-trough movements. Buying into month three of a correction carries timing risk. This is not a reason not to buy — but it is a reason to be deliberate about price.
3. The wrong property type in this market is a liability
Not all Eastern Suburbs and Lower North Shore stock is equal. Right now:
– Investor-grade, high-density apartments in buildings with significant defects exposure or high strata levies are underperforming and likely to continue to do so. We don’t yet know how investors will react to the changes in Capital Gains Tax and Negative Gearing, which may have a further impact on properties primarily held by investors.
– Off-the-plan purchases in buildings not yet complete carry execution risk in a softening market.
– Boutique, low-rise, well-located stock — or houses on genuine land — remains the more defensible purchase.
What your child buys matters as much as when they buy it.
4. Family financial structures require care
Gifted deposits, co-ownership structures, and guarantor arrangements each carry different tax, estate, and relationship implications. This is not the place for a handshake arrangement. Document everything — for your child's protection as much as your own.
What I am seeing on the ground
The Eastern Suburbs and Lower North Shore apartment market is sending clearer signals than the headline numbers suggest — if you know what to look for.
Auctions are being postponed at an unusually high rate. Telling. When agents pull a property from auction in the week before the hammer, it means buyer feedback during the campaign hasn't landed where the vendor needs it. We're seeing this happen with a frequency that isn't normal. It's not panic — but it is a market that has lost its one-directional momentum.
Clearance rates are only part of the picture. Results are highly variable between individual properties right now. A well-presented, well-priced apartment in a boutique building can still attract genuine competition. The apartment two floors up in the same block — more tired, higher levies, perhaps a less ideal aspect — may sit. The averages obscure this divergence entirely.
The vendors struggling are identifiable. Investor-dominated buildings, high strata levy stock, and properties in secondary locations or requiring work buyers no longer want to fund. These are the listings accumulating days on market and cycling through price reductions.
For buyers with genuine capacity and a clear brief, this is a negotiating environment. Private treaty offers that would have been dismissed in 2025 are now being seriously considered. Vendors in the apartment market who have been on the market for 45+ days are increasingly motivated — and their agents know it.
The opportunity is real, but selective. Boutique, low-rise, owner-occupier-dominated buildings in genuine lifestyle locations — Bronte, Coogee, Neutral Bay, Cremorne — remain defensible and in demand. But bargain hunters be wary, the bulk of the softness is concentrated in the type of stock your child probably shouldn't be buying anyway.
In short….
Reasons to act now
– Less buyer competition than at any point since 2019
– Rents are set to keep rising — and are already at crisis levels in the Eastern Suburbs
– Government policy is creating a genuine floor under sub-$1.5m apartments
– Long-term supply constraints in premium Sydney markets are structural, not cyclical
– A co-purchase or gifted deposit today is likely worth more in real terms than the same amount in 18 months of additional rent paid
Reasons to pause or proceed carefully
– Further rate hikes remain possible — serviceability needs genuine stress-testing
– The premium end may not have completed its correction cycle
– Property selection is critical — not all stock is worth buying at any price
– Family financial structures require proper legal and tax advice, not just goodwill
The bottom line
For parents with real financial capacity, this market offers something that hasn't been available for a while: time, selectivity, and negotiating room. That doesn't mean rush. It means be ready, be deliberate, and make sure what you're buying earns its price.
If you're having this conversation in your family and want an independent read — that's exactly what I do.
Mark Timmins is the founder of Marked Buyers Agency, a Sydney-based buyers agency specialising in the Eastern Suburbs and Lower North Shore. markedbuyersagency.com.au
This article contains general market commentary only and does not constitute financial or legal advice. All market data cited is sourced as attributed. Independent financial and legal advice should be obtained before making any property or financial decision.
