The RBA Lifts The Cash Rate To 1.85%

The Reserve Bank lifted the official cash rate by another 0.5% for the third consecutive month today, raising the cash rate to 1.85% in an attempt to battle inflation.

The historic move marks the first time the central bank has lifted the cash rate by three consecutive 0.5% increments.

Further, the last time the RBA lifted the cash rate by more than 1.75% in a four-month period was in 1994, following two 1% hikes in October and December followed by a 0.75% lift in August of that year.

A statement by RBA Governor Philip Lowe outed the board’s want for inflation to return to the 2-3% range over time.

“The path to achieve this balance is a narrow one and clouded in uncertainty, not least because of global developments. The outlook for global economic growth has been downgraded due to pressures on real incomes from higher inflation, the tightening of monetary policy in most countries, Russia’s invasion of Ukraine and the COVID containment measures in China,” said Dr Lowe.

Inflation in Australia is the highest it has been since the early 1990s at 6.1% for the year to the June quarter, and in underlying terms it was 4.9%.

However, there is relief on the horizon, according to Dr Lowe.

“Inflation is expected to peak later this year and then decline back towards the 2–3 per cent range. The expected moderation in inflation reflects the ongoing resolution of global supply-side problems, the stabilisation of commodity prices and the impact of rising interest rates.”

Sydney is well and truly on the world map when it comes to luxury residential property, rivalling—and even beating—the likes of Tokyo and Dubai in terms of price per square metre.

The harbour capital has also proven itself to be a powerhouse for luxury residential rental growth. Knight Frank’s Prime Global Rental Index Q4 2024 showed prime rents across Sydney grew 4.7 per cent over 2024, the fifth-highest growth globally.

This has pushed several of Sydney’s top suburbs over the $2,000 per week median rent mark for a house, with surrounding areas fast approaching the milestone.

We’ve wrapped up the most expensive suburbs to live in across Sydney, with data sourced from property data analytics firm CoreLogic.

1. Vaucluse: Median purchase: $8.69m; Median rent: $2,198

Vaucluse has consistently ranked as Sydney’s most expensive suburb for rental properties over the past few years, even with annual rents contracting by over 14 per cent. What sets it apart is its unique geography—it’s the only suburb in the Eastern Suburbs that stretches from the harbour to the ocean. Homes in Vaucluse top the price charts because most either boast Sydney Harbour views or enjoy uninterrupted outlooks over the Pacific Ocean.

The Neighbourhood

While most Eastern Suburbs have one main beach, Vaucluse is dotted with several secluded spots, such as Parsley Bay, Milk Beach, and the recently reopened Shark Beach, which had been closed for several years due to retaining wall repairs.

2. Dover Heights: Median purchase: $6.38m; Median rent: $2,024

Vaucluse’s immediate southern neighbour, Dover Heights, is the only other suburb in Sydney with a median house rental over $2,000. Dover Heights hugs the cliffs and is well known as one of the most tightly held house markets in the Eastern Suburbs. The homes are perched on the cliffside, and the majority of houses in the area have at least four bedrooms, pushing up prices.

The Neighbourhood

While there are no beaches to speak of, its elevated position provides some of the highest views of Sydney Harbour. It is also home to the Federation Cliff Walk, a five-kilometre clifftop walk with postcard views of the Pacific Ocean from Dover Heights to Watsons Bay.

3. Bronte: Median purchase: $5.64m, Median rent: $1,963

Bronte takes out the title of the most expensive of the ‘typical’ Eastern Suburbs beachside suburbs. Just 30 per cent of homes in Bronte are separate houses, with nearly half being apartments. Houses in the rental pool are typically original homes dating back to the 1960s that have been renovated over the last decade or so.

The Neighbourhood
Bronte has long been a favourite due to its more relaxed beachside lifestyle compared to the busier Bondi, although Bronte is no longer a ‘hidden gem’ anymore. It offers numerous lifestyle perks, from a small high street lined with shops and cafés to several eateries located by the beach, which also features one of the best natural ocean pools in the Eastern Suburbs.

4. North Bondi: Median purchase: $4.81m; Median rent: $1,932

North Bondi has become a hotbed of new homes, with frequent sales of either original houses or older apartment complexes being bought to be demolished and replaced by brand-new contemporary builds. There’s a mix of original cottages and new homes in the rental pool, the latter fetching over $7,000 a week.

The Neighbourhood
North Bondi is situated in a small pocket, just south of Dover Heights and north of Bondi Beach. Starting at the Ben Buckler Peninsula, near where Campbell Parade transitions into Military Road, North Bondi is one of the most secluded areas on the coastline, with Hastings Parade, Brighton Boulevard, and Ramsgate Avenue all offering a southward view over the sand.

5. Balgowlah Heights: Median purchase: $4.13m; Median rent: $1,930

Balgowlah Heights is the most expensive suburb to rent a house in the Northern Beaches. Land sizes tend to be much larger, and you get more for your money in the area compared to the East.

The Neighbourhood
Balgowlah Heights is the harbourside southern neighbour of Balgowlah. The Sydney Harbour National Park occupies half of the leafy suburb, part of the Manly to Spit Bridge Walk, and is home to Tania Park, with a children’s playground and sporting facilities overlooking Manly Cove. Nestled on the northern shores of Sydney Harbour, it offers a serene and leafy environment.

6. Bellevue Hill: Median purchase: $10.63m; Median rent: $1,917

Bellevue Hill stands as one of Sydney’s most prestigious suburbs and has some of the largest houses by median land size.

Given the large gap between median purchase price and median rental price, it is no wonder renters want to live among $10m homes and pay under $2,000 a week, when a $10m purchase means $2m deposit, over $500k in stamp duty, and roughly $12,000 a week in repayments.

Most mansions will never make it to public rental sites and are often snapped up by Hollywood stars, musicians, or even royalty when they visit Australia.

The Neighbourhood
One of the biggest drawcards for those living in Bellevue Hill is the proximity to two of the country’s top schools. While there are no catchment areas for private schools, Cranbrook School and Scots College will always draw affluent families to the suburb. Scots fees start at around $30,000 per annum from Year One and reach nearly $50,000 by Year 12.

Sydney’s Cheapest Suburb: Tregear; Median purchase: $782,000; Median rent: $544

The cheapest suburb to rent in Sydney is Tregear, located on the outskirts of Mt Druitt, approximately 50 km west of the CBD. The median house rental is $544, which is four times cheaper than renting a house in Vaucluse. The median house price in Tregear is $782,000, around 12 times less than Vaucluse.

Sydney’s Best Suburb: Point Piper

If money were no object, it’s hard to look past Sydney’s most affluent suburb as the top pick for the best place to live in the city, in my opinion.

It doesn’t even have an actual median house price, simply because so few properties change hands. Last year, just five houses sold, ranging from $8 million to $51.5 million. Homes on the best streets offer gun-barrel views of the Harbour Bridge and the Opera House, while the cosmopolitan Double Bay next door provides all the lifestyle conveniences.