A property analyst has cast doubt on how much the Treasurer's order to sell a foreign-owned Sydney mansion would help average house hunters.

Joe Hockey announced in Parliament on Tuesday that Point Piper property Villa del Mare, purchased last year for $39 million by a Hong Kong-owned business, must be sold.

"They have 90 days to sell the property," Mr Hockey said.

"We are very serious about enforcing the law. We are very serious about integrity in our foreign investment system."

It is the first time the foreign investment rules have been applied to a home buyer since 2006.

In that nine years the median house price in Sydney has risen by nearly 66 per cent, according to figures for property analysis firm Core Logic RP Data.

Core Logic RP Data senior research analyst Cameron Kusher said the Villa del Mare sale had little in common with the typical Sydney sale.

The mansion boasts a double staircase and harbourside views of the Sydney Harbour Bridge and Sydney Opera House.

"A $40 million sale is probably one of the top 15 or 20 property sales we've ever seen in Australia," Mr Kusher said.

Some of Sydney's high-end real estate agents raised concerns the elite end of the market could be in trouble if the Government drove away overseas buyers, such as the Hong Kong-owned business in this case.

The exterior of the $39 million mansion in Sydney ( Domain.com.au )

Mr Kusher said cracking down on such transactions was also unlikely to help with affordability for the average buyer, unless the publicity generated overseas impacted down the value chain.

"This is the top 1 per cent of sales," he said.

"I don't think that cracking down on someone that skirted the rules to buy a pre-existing home worth $40 million is going to act as a deterrent for anyone else.

"All those people that are doing the right thing and buying off the plan properties, most of them would be doing it at a much lower price point than this."

Mr Kusher said more changes for overseas buyers flagged by the Government last week, including fees of at least $5,000 to fund more enforcement, would hopefully ensure the upside of more investment in new housing without the potential downsides.

He said foreign investors were a positive if their money helped pay for more homes to be built, though there were risks that local buyers would pay more as a result.

"If it's targeting stock that would be appropriate for first-home buyers then yes, potentially they can outbid a first-home buyer for that property," Mr Kusher said.

"The other risk is that these people buy these investment properties, we get all this new stock built, but they don't actually put a renter in there.

"They just hold it vacant and we don't actually add to the rental stock in the market."

The Government's proposals are open for public submissions until later this month.