‘Much more affordable’: Undervalued suburbs hiding in plain sight

These suburbs could be poised for further price growth as buyers seek more affordable options and better bang for their buck.

Property prices around Australia have been steadily rising, with a typical home now worth about $81,000 more than a year ago, and prices up to $153,000 higher in some capitals.

While the federal government’s expanded 5% deposit scheme is likely to help some new buyers get into the market sooner, that stimulus could be a double-edge sword, with added demand expected to push prices higher.

For buyers intent on finding their ideal home for an affordable price this year, rising prices might mean looking in a suburb that’s a little further outside their search grid.

Many suburbs across Australia remain more affordable than their neighbours, but with buyers increasingly prioritising value, that gap may not last for long.

REA Group executive manager of economics Angus Moore said price growth in relatively affordable suburbs and cities was more likely to outpace the wider market in the year ahead.

“We are already in an environment of challenging affordability and with rates moving up that's going to get worse,” he said.

“That will probably favour more affordable parts of the cities, and more affordable cities.”

With that in mind, these are just a handful of suburbs where home prices may be undervalued relative to surrounding suburbs or similar areas.

Canterbury and Campsie, NSW

Sydney’s inner west isn’t exactly the most affordable part of the city, but searching in suburbs southwest of the Cooks River can yield significant savings.

While median prices are well in excess of $2 million in suburbs such as Marrickville ($2.13m), Dulwich Hill ($2.5m) and Hurlstone Park ($2.3m), prices scrape in under the $2 million mark in Canterbury ($1.99m) and Campsie ($1.83m).

Canterbury is one of the few suburbs in Sydney's inner west where buyers can purchase a freestanding period house for less than $2 million. Picture: realestate.com.au/sold

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These suburbs are not only less expensive than their neighbours, but have an upcoming catalyst for growth when the new Metro line opens later this year, allowing access to the city in less than 20 minutes.

Many buyers had already bought into the area ahead of the Metro opening, real estate agent Peter Kassas of LJ Hooker Campsie said.

“We’ve got an influx of buyers coming from Marrickville, Dulwich and Summer Hill,” he said. “It’s six or seven minutes down Canterbury Road but it’s much more affordable.”

Real estate agent Manuel Roussakis of Ray White Canterbury said two-bedroom apartments in the area typically sold for $200,000 to $300,000 less than in Dulwich Hill.

Goulburn, NSW

Situated about an hour from Canberra and two hours from Sydney, the regional city of Goulburn has a median house price of $660,000, which is less than half the cost of a typical Sydney house.

It’s also considerably more affordable than Canberra, where the median house value is just above $1 million, as well as suburbs of the southern highlands such as Moss Vale (1.035m), Bowral ($1.5m) and Mittagong ($1.155m).

Goulburn has a country town feel but the infrastruture and services of a major regional city. Picture: realestate.com.au/sold

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While it’s further from Sydney, its size allows for employment diversity, and its position on the Hume Highway and a direct train line to Sydney enhance its appeal for commuters and first-home buyers.

Real estate agent Patricia Murphy of One Agency Goulburn said the city was growing and attracting new buyers seeking an affordable home within reach of both capitals.

“It used to be Canberra buyers that drove our market but that’s changed over the past five years and more people from Sydney have come this way,” she said. “They’re discovering that it’s more affordable than other cities.”

Bayswater, VIC

Bayswater in Melbourne’s east is transitioning from its industrial past to become a more residential-focused suburb, and offers a little more bang for buck for buyers than pricier nearby suburbs 

While median house prices in Ringwood and Wantirna have already cracked the $1 million mark, Bayswater remains more affordable, although buyers appear to be taking notice – the median price rose by 10% to $950,000 in the past year.

This renovated two-bedroom house in Bayswater sold for $845,000 last year. Picture: realestate.com.au/sold

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Real estate agent Dean Kehagias of Barry Plant Wantirna said Bayswater had the same benefits of surrounding suburbs with the added bonuses of a train station and lower prices.

“It is undervalued in comparison,” he said. “In Wantirna, Ringwood and Heathmont, you’re looking at a sale price 20-30% higher than in Bayswater.”

Wodonga, VIC

While Wodonga forms one half of the twin-city of Albury-Wodonga, home prices are much more affordable than on the northern side of the Murray.

Albury has a median house price is $933,000, compared with $620,000 in Wodonga, meaning a typical house in Wodonga is about 36% cheaper than in its NSW counterpart.

Housing is much more affordable in Wodonga than in Albury, and investors are starting to take notice. Picture: realestate.com.au/sold

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While Albury may be home to older established neighbourhoods and a greater concentration of government and professional jobs, Wodonga has newer housing estates, with the added supply of homes helping to keep prices more affordable.

Prices are growing faster in Wodonga (up almost 15% in the past year) than Albury (up 6%), suggesting buyers are taking advantage of this price gap.

But that relative discount could shrink in the years ahead, according to Elders Real Estate Wodonga director Jamie Maynard, who has been fielding a huge number of enquiries from buyers’ agents representing investors from around Australia.

“We’re an emerging area,” he said. "I believe it’s a more liveable city – it’s easier to get around, it’s got great schools and it's obviously more affordable.”

Beenleigh, QLD

Situated at the halfway point between Brisbane and the Gold Coast, Beenleigh flies under the radar, with home prices that are still relatively accessible.

Its position on the M1 motorway and its own train station allows easy commuting in both directions, allowing the suburb to take advantage of the growth of both cities.

One of Beenleigh's advantages is its position halfway between Brisbane CBD and the Gold Coast. Picture: realestate.com.au/sold

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It’s not as pricey as suburbs closer to Brisbane such as Tanah Merah or more recently developed suburbs in the area with newer housing stock such as Waterford or Holmview.

It has established schools, parks, shops and dining options, and many older homes are ripe for renovation.

Rockingham, WA

With a median house price of $785,000, Rockingham stands out as one of the most affordable coastal suburbs of Perth, with most similarly-priced suburbs situated further from the city or inland.

Although it’s about 45 minutes from the CBD, it’s one of few Perth suburbs where buyers can find a freestanding house within walking distance of the beach for less than $1 million.

Rockingham is one of Perth's few beachside suburbs with a sub-$1 million median house price. Picture: realestate.com.au/sold

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Real estate agent Nola Tully of Harcourts Elite Agents said the area had become more popular as buyer perceptions changed.

“It had been undervalued for many years, but it's been going up a lot over the past five or six years,” she said.

“For a long time it had a stigma from way back in the day when it was a beach town with too many kids with nothing to do, getting up to mischief."

“Now it's a good family area with a great community. The beaches are pristine, there’s beautiful cafes and lots of festivals and things going on.”

Ulverstone, TAS

Situated on Tasmania’s north coast, Ulverstone offers a similar lifestyle and coastal access to nearby towns, but with more affordable home prices.

Ulverstone is one of Australia's most affordable beachside towns. Picture: realestate.com.au/sold

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While nearby Penguin has a higher national profile attracting downsizers and seachangers, properties are pricier as a result. 

Ulverstone is also a little closer to Devonport, which is the main employment centre in the region, yet still has a relaxed small-town feel. 

Hallet Cove, SA

Buyers who are prepared to travel a little further south from Adelaide’s most popular beachside suburbs will find significant savings in Hallet Cove, where the median house price is $945,000.

That’s about $440,000 cheaper than in neighbouring Marino, $455,000 cheaper than Brighton, $720,000 cheaper than Glenelg, and less than half the median price in Somerton Park.

Hallet Cove is a little quieter than other beachside Adelaide suburbs, and a little more affordable, too. Picture: realestate.com.au/sold

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It may lack the traditional cafe strip of some of its neighbours, but makes up for it with clifftop walks, and is serviced by two train stations.