Buyer demand is surging in hotspots of affordability around the country, signalling that these suburbs are set to outperform the rest of the market.
Affordable suburbs of the capitals and key regional cities have had the biggest uplift in buyer demand in the past year, PropTrack data shows.
These areas have experienced a surge of interest from first-home buyers seeking cheaper homes and investors targeting high rental returns, and prices are rising higher as a result.
The data reveals the average number of key enquiries per property listing on realestate.com.au in each suburb to gauge buyer demand in an area.
The measure combines high-intent actions such as emailing an enquiry, calling the agent or downloading documents to determine the level of demand among serious buyers who are ready to purchase a property.
It’s an indicator worth paying attention to – when demand increases and the supply of homes stays the same or declines, prices tend to rise.
Demand has surged in regional cities such as Tamworth as home buyers look for an affordable lifestyle change and investors target high yields. Picture: realestate.com.au/sold
PropTrack senior economist Anne Flaherty said buyer demand data revealed areas where prices were likely to rise faster than the wider market.
“The fact that we are seeing such strong growth in enquiries per listing is a pretty strong signal that these are some of the areas that could outperform for price growth,” she said.
Regional demand surges as prices boom
The data shows that demand is soaring in affordable suburbs of regional cities where homes don’t cost a fortune.
Many of the suburbs with the biggest increases in buyer demand were in cities of regional NSW and Victoria, where homes are much more affordable than in their respective capitals but prices are growing quicker.
Griffith, Dubbo, Tamworth and suburbs of Wagga Wagga such as Glenfield Park and Ashmont had significant increases in enquiries compared to a year ago.
These were among the strongest regional markets for price growth in the past year.
This renovated three-bedroom house in Sebastopol in Ballarat's south – where buyer demand has surged recently – sold for $542,500 earlier this year. Picture: realestate.com.au/sold
Suburbs of Ballarat such as Sebastopol and Wendouree stood out for a strong rise in demand, while buyer interest surged in Whittington and St Albans Park in Geelong.
These smaller cities have outpaced Melbourne for price growth in the past year, with values in Geelong growing three times as fast as the capital.
Ms Flaherty said prices were rising faster in regional cities across Australia as more first-home buyers and investors targeted affordable markets.
“Over the past year we have seen regional markets slightly outperform their capital city counterparts in most states,” she said. “Major regional hubs have been continuing to do well.”
Ms Flaherty said more people have been moving from the capitals to the regions than the other direction since well before the pandemic, which accelerated the tree-change trend.
Buyers have targeted Geelong suburbs where block sizes are larger and homes are more affordable, such as St Albans Park. Picture: realestate.com.au/sold
Geelong real estate agent and Hayeswinkle East Geelong director Tiffany Simpson said the city’s affordability, proximity to Melbourne, and lifestyle and job opportunities meant it was on the radar for both first-home buyers and investors.
“We’re the closest big town to Melbourne, and given our median house prices it’s an obvious choice for many people,” she said.
“We have quite extensive infrastructure whether that's medical, schooling, or industry, and multiple train stations so it’s very easy to get to Melbourne.”
High rental yields and larger block sizes made Whittington and St Albans Park appealing to both investors and first-home buyers, many of whom were relocating from Melbourne, Ms Simpson said.
Investors search interstate for high yields and growth
Regional cities have been firmly on the radar of buyer’s agents representing borderless inventors across Australia, further fuelling demand in many affordable markets outside the capitals.
Enquiries have shot up in affordable suburbs of Launceston such as Ravenswood and Newnham as values surged following a post-pandemic pause.
Interstate investors have bid up prices of properties in affordable Launceston suburbs such as Ravenswood, agents say. Picture: realestate.com.au/sold
Real estate agent Lochie Reid of Living Here Launceston said relative affordability and high rental yields had led to extremely high demand from investors, and interstate enquiries had surged recently.
“The majority of enquiries are buyer’s agents looking to purchase properties for their investor clients,” he said. “I sometimes get 10 calls a day from buyer’s agents.”
Competition between first-home buyers and investors was driving price growth, Mr Reid said, especially in affordable suburbs such as Ravenswood, where house prices jumped 15% in the past year to a median of $420,000.
“While those investors are pushing up the prices, in many cases first-home buyers and owner occupiers are still purchasing,” he said.
Buyers compete in affordable heartland
Some of the most in-demand suburbs nationally were situated in traditionally-affordable parts of the capitals.
In Sydney, this included suburbs rapidly evolving such as St Marys, where houses for sale typically received more than 150 enquiries and prices have jumped 17% in a year, as well as Whalan, which is one of the few remaining Sydney suburbs with a median house price below $1 million.
The most in-demand Brisbane suburbs were almost all located in the city’s south and west, including Rocklea, Goodna, Hillcrest and Slacks Creek.
In Melbourne, nothern suburbs such as Dallas, Coolaroo, Broadmeadows and Campbellfield had the strongest levels of enquiry from buyers.
Ms Flaherty said the broad range of buyers looking in affordable outer suburbs drove strong competition for homes that came up for sale, with demand expected to remain intense while interest rates stayed high.
“Affordability is driving more people into those areas,” she said. “Whenever homes do come up for sale in one of these areas, they’re attracting more buyers than they used to because a larger cohort of buyers have been priced out of middle ring suburbs so they’re looking further out.”
“This trend is not going away any time soon, especially given that we’ve seen two interest rate rises this year and we might see even more.”
The new St Marys metro station will provide access to Western Sydney Airport and is expected to provide a catalyst for further growth in the suburb. Picture: realestate.com.au/sold
Demand from both first-home buyers and investors has increased recently, Ms Flaherty said.
“We have seen first home buyer loans really pick up in recent months especially in response to the 5% deposit scheme.”
“Investors are often looking for high growth areas and a lot of these outer suburbs where the purchasing price is a little bit lower have pretty good capital growth track records as well.”
Pockets of affordability, such as Goodna in Brisbane's southwest, remain in high demand. Picture: realestate.com.au/sold
Ms Flaherty said some upsizing buyers were also looking for larger properties in outer suburbs, which were prohibitively expensive in inner areas.
“Even for people who might be looking to upgrade and move from smaller inner and middle ring homes to larger homes, often the way they do it is to move a little bit further out to increase their living space,” she said.
Premium pockets retain appeal
Despite the high interest rate environment, it wasn’t just affordable areas ranking highly for enquiries, with eastern suburbs such as Rose Bay and Bronte standing out in Sydney.
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Perth differed to the other capitals in that many of the most in-demand suburbs were in higher-value areas located close to the coast.
White Gum Valley topped the list with more than 120 enquiries per listing, with pricier suburbs such as Trigg, East Fremantle and Applecross also ranking highly.
Perth's most in-demand suburbs were concentrated mostly in the west, including beachside Trigg. Picture: realestate.com.au/sold
Ms Flaherty said Perth’s property market had been exceptionally strong in recent years and many homeowners had significant equity at their disposal, while higher median incomes supported demand for homes in higher priced suburbs.
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