Sydney or Regional? How Smart Property Choices Shape Your Future
The reality of housing affordability has shifted, are you adjusting your strategy?
The average house price in Sydney has hovered around the $1.1 million mark for the past year, with CoreLogic data showing an annual increase of 8.7% to April 2025. This makes it incredibly difficult for first-home buyers and young professionals to enter the property market unless they are willing to compromise somewhere else, like on lifestyle or debt levels.
So what are your options if you're sitting on some savings and ready to invest?
Option 1: Buying in Sydney
This traditional path comes with its prestige and long-term potential, but also significant financial pressure.
Minimum outlay: Around $900,000–$1.1 million for a basic home or unit
Loan size: Upwards of $700,000, depending on deposit
Repayments: At an average interest rate of 6.0% (as of June 2025, RBA), that’s around $4,200/month over 30 years
Upside: Long-term capital growth and high demand
Downside: Greater financial stress and limited flexibility for lifestyle spending
If you’re a young professional earning $120,000–$150,000, this could be a stretch, especially when you factor in rising living costs and interest rate volatility.
Option 2: Buying a Regional Investment Property
More Australians are choosing to invest where it’s affordable and live where they love. The Regional Australia Institute reported that regional migration remains above pre-pandemic levels, while property prices in regional towns are still significantly lower than metro areas.
Purchase price: ~$450,000
Loan size: ~$350,000
Repayments: Around $2,100/month
Extra potential: Top up your offset account with $1,500/month
Upside: Lower financial pressure, more manageable debt, room to grow savings
If the property earns modest rental income and you actively pay down the principal, in five years you may build equity of $200,000–$250,000, combining growth and your extra contributions. Plus, you demonstrate strong repayment capacity for your next property move.
Designing Your Strategy Around Your Life
This isn’t just about money, it’s about lifestyle choices. Do you value overseas holidays, regular dining out, and flexibility in your budget? Then a lower-risk investment property might suit you better than pushing to the financial edge with a city mortgage.
Tip: Use an offset account or redraw facility to reduce interest while retaining access to your money. According to Canstar, this strategy can save tens of thousands in interest over a loan’s lifetime.
Whether you're living at home to save or renting in the city while investing elsewhere, the key is to align your financial strategy with your lifestyle values and long-term goals.
Next steps? Speak with a qualified adviser to understand your borrowing capacity, investment options, and how to structure your debt efficiently.
Visit Financial Wellness Hub for a complimentary session tailored to your goals.
Download Sydney or Regional Wealth Strategies Checklist here.
By Brett Tarlington