Wei Liao, an 18-year-old Chinese student was the one to die while her 19-year-old Korean boyfriend, Chris Han, suffered a fractured pelvis and legs. The couple had been held hostage for more than an hour with their 20-year-old female flatmate and a female friend, police said.
The intruder, described as dark-skinned and aged about 30, followed the couple's female friend through the apartment block's security entrance about 12.35pm.
Once in the lift, the man held a knife to the woman's throat and accompanied her up to the flat.
Superintendent Freudenstein said the intruder was inside the apartment for an hour before the couple tried to escape from the balcony.
"It's believed the deceased and the injured male were trying to get to the next level - from level three to level two - to try and get away from the offender."
"Something's happened in that unit to make them take that step... for them to try and climb to the balcony beneath."
He said police were still trying to piece together what happened while the armed man was inside the unit.
"There is nothing to suggest that they targeted those victims, nothing to suggest that they knew those victims. Whatever the case, this is the first time in my 28 years working that I've seen such a horrific incident as this,'' Freudenstein said.
The pair's flatmate, a 20-year-old Chinese woman, was not injured. Apparently they were all studying towards their HSC-equivalent qualification at a local college.
Other reports said a male intruder had made the pair jump from the balcony
"They were forced to do sexual acts and then forced to jump off the balcony. That's why they were naked,'' a source said.
Superintendent Freudenstein said it appeared the intruder had run off after the victims fell. Police have asked for people who may have seen the man in the area to contact them.
Security camera footage is being examined.
Neighbours told police they saw the pair falling from the balcony of flat 606. Lee Jae-Hyuk, a student who lives opposite, said his younger brother, Lee Jae-Min, saw Wei fall before the man. Lee Jae-Min, 19, told his brother he saw the man lying on the ground groaning.
The owner of the flat, Gina Fiorentino, said the tenants had been there for two years.
Her neighbour's son, who lives in the unit above 606, called Fiorentino on Sunday to tell her "something terrible has happened''. "He said he could see blood and knives on the balcony.''
Fiorentino said she had never had problems with the tenants who paid their rent on time.
Another neighbour, Bas Bomer, said he and his friend Hans Veerhuis had been on their balcony when they heard a "dull smack''. Bomer, whose flat is opposite, said he thought he had heard a traffic collision.
"We heard the noise and we came around the corner ... there were people hanging over their balconies with their hands covering their mouths,'' he said.
"We saw the bloody spots on the towel [that was covering them] but it was only [then] we realised what we'd seen.''