New analysis has revealed where Sydneysiders can profit the most from downsizing, showcasing the suburbs with the greatest price differences between bedroom sizes.
Sydney’s high-value north shore and eastern suburbs lead the way when it comes to the biggest savings for homeowners downsizing their houses, according to research by Muval.
Mosman tops the list, with four-bedroom homes costing an average of $5.58m and moving to a three-bedroom home saving downsizers around $2.1m.
On average, Mosman downsizers save $1.69m when downsizing by one bedroom.
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Five-bedroom 53 Clanalpine St, Mosman sold for $7.7m earlier this month
This three-bedroom home on Bray St, Mosman, recently sold for $3.75m
Eastern suburbs Woollahra and Waverley followed closely, with homeowners saving between $1.2m and $2.05m when downsizing in the area,
In the Northern Beaches, downsizers save an average of $723k when moving to a home with one less bedroom.
Muval CEO and co-founder James Morrell said many homeowners were “sitting on substantial equity”.
“In NSW, especially across Sydney’s premium suburbs, the reason you see such a big gap between one, two and three-plus-bedroom prices really comes down to what you’re actually paying for,” he said.
“It’s less about the extra bedroom and more about land, location and housing type.
“In places like the North Shore, Eastern Suburbs and inner-ring suburbs, houses are heavily driven by land value and scarcity, while apartments are priced more around lifestyle and building quality, so even within the same suburb, they effectively sit in different markets.”
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Muval CEO James Morrell. Picture: Supplied
Mr Morrell said tight planning rules and limited new housing supply in these areas will only serve to widen that gap over time.
Mr Morrell said downsizing was only a relatively small share of overall moves in these suburbs, with most people tending to move into similar-sized homes rather than significantly smaller ones.
“What that means in practice is that downsizing in these areas is quite concentrated: it’s usually people ‘right-sizing’ locally into apartments rather than a broadbased shift out of large homes,” he said.
“At the same time, overall mobility is relatively subdued, which also limits how many downsizing moves actually flow through the market.”
Mosman also leads the way for apartment owners downsizing, with moving from a three-bedroom apartment to a two-bedroom unit freeing up $1.46m, with an additional $642k saved by downsizing further to a one-bedroom.
Woollahra and North Sydney followed, offering average savings of $947k and $763k, respectively.
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This two-bedroom Mosman unit sold on February 28 for $1.95m
A one-bedroom unit on Mosman’s Middle Head Rd sold on the same day for $862,000
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Other areas such as Waverley, Hunters Hill, Lane Cove, Randwick, Canada Bay, and Ku-ring-gai also featured among Sydney’s best areas for downsizing.
In Hunters Hill, for instance, downsizing from a unit with three bedrooms down to two saves $597,000, while moving down one less bedroom apartment releases another $535,000.
“Moving to a smaller home, even within the same suburb, could unlock significant cash,” Mr Morrell said.
“It’s not just owners benefiting – renters can also save hundreds of dollars a week by opting for fewer bedrooms, making downsizing one of the most practical ways to ease housing costs.”
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Sydney areas with the biggest savings when homeowners downsize
| LGA | 4-3 bedrooms | 3-2 bedrooms | 2-1 bedrooms | Average saving |
| Mosman | $2.10m | $1.58m | $1.38m | $1.69m |
| Woollahra | $2.07m | $2.05m | $612k | $1.57m |
| Waverley | $1.01m | $1.63m | $956k | $1.20m |
| Lane Cove | $1.08m | $1.46m | $443k | $997k |
| Willoughby | $910k | $977k | $1.00m | $964k |
| Hunters Hill | $766k | $842k | $1.11m | $905k |
| North Sydney | $785k | $914k | $823k | $841k |
| Randwick | $778k | $824k | $793k | $799k |
| Northern Beaches | $684k | $1.01m | $477k | $723k |
| Ku-ring-gai | $761k | $1.31m | $68k | $714k |
Source: Muval
