The Inner West of Sydney remains one of the most vibrant and in-demand property markets in New South Wales, renowned for its proximity to the CBD, diverse housing stock, and thriving community atmosphere. As buyers’ agents with deep expertise in the Inner West, we are frequently asked whether it is better to purchase an apartment or a townhouse in the current market. This decision is nuanced and depends on a range of factors, including lifestyle preferences, investment goals, affordability, and the unique characteristics of each property type.
Market Overview: Inner West Sydney in 2025
The Inner West property market in 2025 is characterised by robust demand, limited supply, and ongoing infrastructure upgrades. Freestanding houses and terrace homes continue to command premium prices, while modern apartments and boutique townhouses are increasingly popular among young professionals, downsizers, and investors. The extension of the Sydney Metro City Line and ongoing gentrification in suburbs such as Marrickville, Dulwich Hill, and Petersham are enhancing connectivity and driving capital growth across the region.
Apartments in the Inner West: Affordability and Growth Potential
Affordability and Accessibility
Apartments in the Inner West are significantly more affordable than houses, with median prices in suburbs such as Leichhardt sitting at approximately $950,000 for units, compared to nearly $2 million for houses. This makes apartments an attractive entry point for first-home buyers, investors, and downsizers seeking proximity to lifestyle amenities, public transport, and the CBD.
Capital Growth Outlook
Recent forecasts suggest that apartments in the Inner West may outperform houses in capital growth over the next few years. Oxford Economics Australia projects annualised growth rates of 6.7% for units, compared to 6.2% for houses from 2025 through 2027[2]. Suburbs like Lilyfield have already demonstrated strong performance, with unit prices rising by over 14% in the last year alone. The scarcity of new apartment developments and strong demand from younger buyers and downsizers further support the case for apartments as a sound investment.
Lifestyle and Amenities
Modern apartments often offer lifestyle amenities such as gyms, pools, and communal gardens, as well as convenience to cafes, parks, and transport hubs. However, apartment living can come with certain drawbacks, including limited space, strata fees, noise from neighbours, and restrictions on pets or renovations. It is essential to consider the quality of construction, the reputation of the strata management, and the location within the suburb to maximise both liveability and resale value.
Townhouses: Space, Privacy, and Community
Space and Liveability
Townhouses typically provide more space than apartments, often featuring multiple levels, private courtyards, and lock-up garages. This makes them particularly appealing to couples, small families, or individuals seeking a balance between the low maintenance of an apartment and the space of a house. Townhouses can offer greater privacy, fewer shared walls, and a stronger sense of community, especially in smaller complexes.
Investment Performance
Townhouses in the Inner West have historically maintained their value better than high-density apartments, partly due to their relative scarcity and appeal to owner-occupiers. They are often located in established, sought-after neighbourhoods with access to quality schools, parks, and transport, which helps them weather market fluctuations more effectively. However, as with apartments, townhouses are subject to strata fees and by-laws, which can vary depending on the size and management of the complex.
Considerations for Buyers
While townhouses offer a compelling mix of space and affordability, buyers should be mindful of the quality of construction, the number of units in the complex, and the specific strata arrangements. Well-built, low-density townhouses in prime locations are likely to deliver strong long-term capital growth and rental demand. Conversely, townhouses in oversupplied or poorly managed complexes may underperform.
Comparative Table: Apartments vs. Townhouses in the Inner West
| Feature | Apartments | Townhouses |
| Price Point | Lower entry price; more affordable | Higher than apartments, lower than houses |
| Space | Compact; limited outdoor space | More spacious; private courtyards/garages |
| Strata Fees | Can be high, especially in large complexes | Moderate; generally lower in small complexes |
| Privacy | Less privacy; more shared walls | Greater privacy; fewer shared walls |
| Maintenance | Low; building management handles upkeep | Low to moderate; some private maintenance |
| Capital Growth | Strong outlook (2025–2027) | Historically stable; strong in top suburbs |
| Rental Demand | High, especially near transport/amenities | High, especially for families |
| Restrictions | More by-laws (pets, renovations, etc.) | Fewer restrictions in smaller complexes |
| Community | Larger, less personal | Smaller, more community-oriented |
Key Considerations for Property Buyers
When deciding between an apartment and a townhouse in the Inner West, we recommend that buyers consider the following:
- Lifestyle Needs: Assess your requirements for space, privacy, and amenities. Townhouses suit those seeking more room and a private outdoor area, while apartments offer convenience and lower maintenance.
- Budget: Apartments provide a more accessible price point, but townhouses may offer better long-term value in certain locations.
- Investment Goals: Apartments are forecast to deliver strong capital growth in the coming years, particularly in suburbs benefiting from infrastructure upgrades and limited new supply. Townhouses, especially in boutique complexes, have a proven track record of stability and appeal to a broad demographic.
- Strata and Ongoing Costs: Both property types incur strata fees, but the scale and inclusions can vary widely. Review the strata management, by-laws, and financial health of the owners’ corporation before purchasing.
- Location: Proximity to transport, schools, parks, and shopping precincts is critical for both liveability and future resale value.
The Value of Professional Guidance
Navigating the competitive Inner West Sydney property market requires expert knowledge and strategic insight. Buyers’ agents with local expertise can provide access to off-market opportunities, negotiate favourable terms, and guide you through the complexities of strata living, building inspections, and contract reviews. Engaging a buyer’s agent ensures that your interests are represented and that you make an informed decision aligned with your goals.
Conclusion: Which is Better Right Now?
There is no universal answer to whether it is better to buy an apartment or a townhouse in the Inner West at this moment. Both property types offer compelling advantages, and the optimal choice depends on your individual circumstances, financial position, and long-term objectives.
Apartments present an affordable entry point and are poised for strong capital growth in the next few years, particularly in well-located, low-density developments. Townhouses offer greater space, privacy, and stability, making them ideal for those seeking a balance between lifestyle and investment performance.
We recommend that property buyers in the Inner West engage with experienced buyers’ agents to thoroughly assess their options, identify high-performing suburbs, and secure the best possible outcome in this dynamic market. If you are considering your next move, contact us at Buyer’s Domain for tailored advice and expert representation in Sydney’s Inner West.
Let us help you make a confident and informed property decision in 2025 and beyond.
