New analysis has revealed where Sydneysiders can make the most of downsizing, showing the suburbs with the biggest price differences between bedroom sizes.
Sydney’s high-priced northern shores and eastern suburbs are leading the way when it comes to the biggest savings for homeowners downsizing, according to research by Muval.
Mosman tops the list, with four-bedroom houses costing an average of $5.58m and moving into a three-bedroom house costing the lowest at around $2.1m.
On average, Mosman downsizers save $1.69m when downsizing on a one-bedroom.
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Five-bedroom 53 Clanalpine St, Mosman sold for $7.7m earlier this month
This three-bedroom home in Bray St, Mosman, recently sold for $3.75m
The eastern towns of Woollahra and Waverley followed closely behind, with landlords saving between $1.2m and $2.05m when downsizing in the area,
On the Northern Beaches, downsizers save an average of $723k when moving to a small one-bedroom home.
Muval CEO and founder James Morrell said many homeowners are “sitting on too much equity”.
“In NSW, particularly in the uplands of Sydney, the reason you see such a big gap between one, two and three bedroom prices is because of what you’re actually paying,” he said.
“It’s less about the extra bedroom and more about the land, the location and the type of housing.
“In places like the North Shore, Eastern Suburbs and inner-ring suburbs, houses are driven more by land value and scarcity, while apartments have more value in terms of lifestyle and build quality, so even in the same area, they sit well in different markets.
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Muval CEO James Morrell. Image: Provided
Mr Morrell said stricter planning regulations and the limited supply of new housing in these areas would serve to widen that gap over time.
Mr Morrell said downsizing was only a small part of the movement in these suburbs, with more people tending to move to homes that are the same size rather than too small.
“What that means is that the downsizing in these areas is very concentrated: people often ‘fit’ the area into houses rather than from large houses,” he said.
“At the same time, overall flow has slowed, which has also limited how many downgrades flow into the market.”
Mosman is also leading the way in downsizing for apartment owners, with moving from a three-bedroom apartment to a two-bedroom apartment saving $1.46m, with another $642k saved by downsizing to a one-bedroom.
Woollahra and North Sydney followed, offering average savings of $947k and $763k, respectively.
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This two-bedroom unit in Mosman 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 are also included among Sydney’s best places to downsize.
In Hunters Hill, for example, downsizing from a three-bedroom unit to a two-bedroom unit saves $597,000, while downsizing to a one-bedroom apartment takes out another $535,000.
“Moving to a smaller house, even in the same area, can open up a lot of money,” said Mr Morrell.
“It’s not just owners who benefit – renters can save hundreds of dollars a week by choosing fewer bedrooms, making downsizing one of the most practical ways to reduce housing costs.”
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Sydney’s most cost-effective areas where homeowners are downsizing
| LGA | 4-3 bedrooms | 3-2 bedrooms | 2-1 bedrooms | Average savings |
| 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 |
| In the ring-gai | $761k | $1.31m | $68k | $714k |
Source: Muval
