Australia’s cheapest suburbs revealed: Where properties cost as little as $33,000

Dotted across Australia are towns and suburbs where typical houses sell for a fraction of the price in big cities.

PropTrack data has revealed the cheapest suburbs around the country to buy a house or a unit, highlighting just how affordable homes outside Australia's pricey capital cities can be.

The data shows that in these suburbs, median-priced properties can cost $300,000 or less.

But while cheap house prices may be a big drawcard, there are major trade-offs that come with buying a property in many of these affordable areas.

Most of Australia’s cheapest suburbs are spread across the nation’s mining and manufacturing heartlands, where property prices are susceptible to the boom and bust periods of these cyclical industries.

Furthermore, the vast distances separating these towns from major cities and centres of employment plays a factor in property prices, with one-industry towns less able to support large populations that put upward pressure on prices.

Top 10 most affordable Australian suburbs for buying a house

The data shows that the cheapest suburb in Australia is Kambalda West, about 60km south of Kalgoorlie in Western Australia’s goldfields region, with a median house value of $226,000.

It forms one half of the town of Kambalda, a mining town focused on nickel and gold production.  

The mining industry serves as a major employer for locals, according to ABS data, but the population has been declining for the past decade as mining companies increasingly use fly-in-fly-out workers, limiting demand for housing.

Broken Hill in western NSW has one of the lowest median house prices of all Australian towns and suburbs. Picture: Getty

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It was followed by Broken Hill in western NSW, which had a median house value of $266,000.

The data used PropTrack’s automated valuation model (AVM) to determine a suburb’s median house or unit value.

While that figure represents the middle value of all houses in the town, many properties have sold recently for much less.

This three-bedroom house, described in the listing as "a true renovator's delight", sold for $33,000 in June last year. Picture: realestate.com.au/sold

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The cheapest property to sell in Broken Hill in the past year was a three-bedroom house which sold for just $33,000 in June last year. Another two-bedroom Broken Hill house traded for $49,000 in November.

Most of the cheapest properties to sell in Broken Hill have required extensive maintenance or modernisation.

Real estate agent Mitchell Halpin of Broken Hill First National said buyers who purchased the cheapest properties in town usually intended to demolish the house and rebuild on the block.

“The way people look at it is they’ll pay land value and factor into their budget what it costs to clear the house away,” he said.

“Some people do save them and renovate, but nine times out of 10 they’re in disrepair.”

This rundown Broken Hill house on a 841sqm block sold for $49,000 in November. Picture: realestate.com.au/sold

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Unlike smaller mining towns, Broken Hill is the largest city in far west NSW and has more diverse employment options including healthcare, education, and retail.

But its population of about 17,500 has been declining over the past few decades, reducing housing demand and constraining price growth.

The Queensland towns of Dysart ($274,000), Moura ($290,000) and Blackwater ($316,000) are some of the cheapest towns in the state for houses. 

This Moura house sold for $200,000 in September. It was rented for $330 per week, equating to an 8.6% gross rental yield. Picture: realestate.com.au/sold

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Property prices are tied to the cyclical coal industry, as well as agriculture, with their remoteness playing a part in affordability.

Top 10 cheapest Australian suburbs for buying a unit

REA Group senior economist Anne Flaherty said mining towns may often have very high rental yields as a result of rising demand for rental properties when production is ramping up, but property prices don’t always follow suit.

“When there's a lot of need for people to live near the mining site, that drives up rents,” she said. 

“But the value of the property does not necessarily increase at the same speed because there’s still that risk that in several years time demand could decrease or the mining project winds down.”

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Ms Flaherty said prices could be volatile in single-industry towns depending on the stage of the mining investment cycle, which could deter some investors seeking more stable returns.

“People aren't going to want to pay too much to invest in a mining town perhaps compared to another destination where there's a diverse economy.”

Top 10 cheapest capital suburbs for buying a house

The data shows that even within the capitals, there are still suburbs where houses can be found for less than $500,000, although most were concentrated in one city.

Hobart was home to seven of the top 10 cheapest suburbs across the capitals, with Gagebrook in the city’s north the most affordable with a median house value of $449,000.

Other Hobart cities with affordable house prices included nearby Herdsmans Cove ($452,000) and Bridgewater ($499,000).

Gagebrook in Hobart is the cheapest suburb in an Australian capital city, with a median value of $449,000. Picture: realestate.com.au/sold

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Real estate agent Aaron Murray of 4one4 Property Co. said these suburbs were developed with a significant portion of government-built housing which influenced how they were viewed by local buyers, but that perception was changing.

“We have a lot of buyers' agents looking here, with one of the strongest rental yields Australia-wide,” he said.

“We’re seeing a lot of first-home buyers buying properties there due to their budgets.

“First-home buyers move in, start doing renovations and add value, which is changing the reputation.”

Melton in Melbourne's west is the city's cheapest suburb to buy a house. This three-bedder sold for $520,000 in September. Picture: realestate.com.au/sold

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The cheapest suburbs within the capitals are typically found at the very fringe of the city, including Melton ($548,000), which is about 44km from the Melbourne CBD.

Brisbane’s two cheapest suburbs, Russell Island ($472,000) and Macleay Island ($524,000), are actually located offshore, with residents gaining access via ferry.

Top 10 cheapest capital suburbs for buying a unit

Five of the top 10 cheapest suburbs for units were located in Darwin, including Karama ($343,000), Gray ($345,000) and Coolalinga ($369,000).

But with prices in the Northern Territory capital rapidly rising as a result of increased investor demand, it might not stay that way for long.

Carlton has some of the most affordable unit prices of all capital city suburbs, owing to a high concentration of compact apartments. Picture: realestate.com.au/sold

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Several inner Melbourne suburbs with high concentrations of smaller apartments stood out for affordable unit prices, including Caulfield East ($331,000), Travancore ($370,000) and Carlton ($398,000).

Ms Flaherty said prices in affordable markets were likely to rise in the year ahead as a result of the federal government’s expanded 5% deposit scheme.

“This policy is expected to drive up demand from first-home buyers, particularly at the more affordable end of the market,” she said.