These are the top 10 affordable suburbs in Australia
Broadbeach Waters, Qld., Sep. 6, 2021 /Medianet/ --
These are the top 10 affordable suburbs in Australia
Housing market rebound
In 2020, Australia’s first national property buyer’s agency network BuyersBuyers.com.au reported that every capital city in Australia represented an incredible property buying opportunity for those with secure jobs and a medium to long-term outlook.
Pete Wargent, co-founder of BuyersBuyers said that “as we noted last year, the lowest mortgage rates on record meant that all cities offered opportunities for those with a reasonable buffer and a level of employment security”.
“With first homebuyer incentives in play we expected affordable suburbs to be sharply in focus”.
“In addition, ultra-low interest rates have created a unique environment where buying a house in many areas is cheaper than paying rent on one. And, as we expected, this did prove to be the case” Mr Wargent said.
Indeed, Australia’s housing market has experienced an exceptional strong 12 months with the capital city markets recording year-on-year price growth to August 2021 of 17 per cent, and many regional markets also recording exceptionally strong price growth.
For this reason, housing affordability is back in the spotlight, as first homebuyers struggle to bridge the deposit gap, and upgraders find prices escalating away from them.
Mr Wargent of BuyersBuyers said that “despite the strong price growth seen over the past year, some affordable opportunities do still exist for open-minded homebuyers prepared to undertake the relevant research”.
“Many homebuyers are also now taking advantage of the COVID-19 landscape shifts and are taking the opportunity to work from home or remotely, which opens up a greater range of suburb choice” Mr Wargent said.
The opportunities and outlook for 2022
RiskWise Property Research has compiled a list of suburbs where prices are around 70% of the median capital city house price, thus representing sound value, while still being within relative proximity to the Central Business District (or in the case of south-east Queensland, the south-east corridor).
Mr Wargent of BuyersBuyers said that “of course, there are cheaper suburbs in more distant or less favoured locations but buying in the lowest quartile of the housing market can sometimes come with its own challenges and risks”.
“In New South Wales, parts of the Central Coast region, Illawarra, and Sydney’s Outer West areas, including the Blue Mountains, were deemed more affordable, with houses coming in between $800,000 and $900,000 compared to Greater Sydney’s median house price which now sits around $1.2 million”.
“For example, despite recording solid capital growth of 41 per cent over the past five years, Blaxland in the Blue Mountains still has a median housing price of under $850,000” Mr Wargent said.
At approximately 60 kilometres from the Sydney Central Business District, Blaxland is a difficult commute for those employed in central Sydney, but employment opportunities do exist much closer than the centre of Sydney, and many workers are now employed on more flexible arrangements.
Although the most desirable properties in the area have now become expensive, solid detached homes can still be bought today at around the $800,000 mark.
Mr Wargent of BuyersBuyers said “in Victoria, some suburbs on the Mornington Peninsula and in Geelong have also been seen as affordable areas with prices in the $600,000s compared to Greater Melbourne of above $900,000 although price growth has accelerated in Mornington over the past year”.
“Both regions are in easy reach of the city and have enjoyed capital growth of, on average, around 50 per cent over the past five years”.
“However, prices have been rising quickly. For buyers with a tighter budget, Cranbourne North still offers an opportunity to get into the market, with a median house price of under $650,000” Mr Wargent said.
The suburb is located approximately 40 kilometres to the south-east of Melbourne’s Central Business District.
Meanwhile, in Queensland, which has a median price for houses in Greater Brisbane of around $650,000, the more affordable areas with good access to the CBD include Logan and Moreton Bay South.
Mr Wargent said “Greater Brisbane’s housing market is presently experiencing strong price growth for detached houses, but for those with a budget of around $500,000, there is still a worthwhile opportunity to buy in Acacia Ridge”.
Acacia Ridge is located approximately 15 kilometres to the south of Brisbane’s CBD, and has seen median price growth of around 27 per cent over the past 5 years.
With a median price approaching $500,000, there are still many relatively affordable homes to be bought in the suburb.
The list of the top 10 affordable suburbs in Australia is presented below.
Figure 1 – The top 10 affordable suburbs in Australia
Source: RiskWise Property Research, CoreLogic
Elsewhere, in South Australia, Adelaide North had the highest number of affordable houses.
The median house price for Greater Adelaide is approximately $550,000, and both new supply and the wider housing market are presently very tight, suggesting that the median house price will soon rise towards $600,000 in the South Australian capital.
Despite this it’s still possible to buy houses at considerably cheaper price points in many outer-suburban areas of Adelaide.
While the Perth market has not been a strong performer over the past half decade, there are still some areas delivering both affordability which have demonstrated relatively good growth in the past five years.
The median house price in Perth is around $550,000, suggesting plenty of upside potential as the state’s economy improves in line with the resources cycle.
In the Australian Capital Territory, with a median price of nearly $900,000 houses have continued to perform especially strongly throughout the pandemic period.
The ACT has appeared to be almost bulletproof for major shocks, largely thanks to an extremely robust job market with most employment linked in some way to the government and strong economic growth, although the recent lockdown will represent the first real test for the city.
In Hobart too, despite electric house price growth over recent years, there are still many affordable areas that come in well below the median house price, which is now approaching $550,000.
Please note: This list is based on suburbs that are around 70% of the medium price (i.e. not the most affordable suburbs in each capital city) and suburbs with at least 1000 houses in the existing stock.
It should be noted that the lower end of the housing market presents different types of risks.