Australia’s most in-demand suburbs revealed

New research has identified the most in-demand capital city suburbs across the country.

Property research site LocationScore.com.au has crunched the numbers to identify the top five suburbs and property types across selected capital cities where demand has improved above supply over the past 12 months.

The research scores each suburb out of 100 on eight key indicators that measure the level of demand and supply as well as growth prospects.

Director of Research at LocationScore.com.au, Jeremy Sheppard, said when demand is outstripping supply in a location, strong future value gains can follow.

“Rocketing demand relative to supply is an excellent indication of a suburb’s potential for property price growth,” Mr Sheppard said.

“By unearthing hot demand-growth zones, investors can narrow down the search area when looking for their next investment.

“The trick is to track all the factors that drive the demand/supply curve in a suburb. When demand is ramping up faster in one location compared to others, it’s time to pay attention.”

Mr Sheppard researched suburbs and property types with the strongest relative demand growth across Sydney, Melbourne, Brisbane, Adelaide, Hobart and Canberra by tracking the speed at which the LocationScore changed each month over the course of the past year.

By graphing the monthly speed of change, he was able to isolate five suburbs and property types in each capital where the index rose the fastest. “Many of these suburbs offer great value currently,” Mr Sheppard said.

In addition, each suburb’s current LocationScore out of 100 reveals its strength as an investment prospect, with a score above 62 considered Good, or above 77 considered Excellent.

Sydney

All five of the Sydney growth suburbs were located in the city’s south-west as buyers sought more affordable options away from the CBD, according to Mr Sheppard.

Condell Park units saw the fastest growth in relative demand, taking out the top spot in Sydney, and with a LocationScore of 76 it offers Good potential for buyers.

Located just over 20 kilometres form the Sydney CBD, the suburb is garnering plenty of interest from online property watchers according to the research.

“Even in Sydney’s pricey market, you can find units in Condell Park available at a median of approximately $530,000,” he said.

Oatley and Caringbah South units were other fast movers that were hunted heavily via online searchers, and with LocationScores of 74 and 72 points respectively, they’re both considered Good prospects according to the research.

According to Mr Sheppard, these locations, along with Kareela, were becoming popular with buyers seeking near-water locations at more reasonable prices than suburbs to the north.

“While these suburbs remain reasonably pricey, other locations closer to the CBD with similarly easy water access have substantially higher buy-in prices,” he said.

Melbourne

In the strengthening Melbourne market, four of the top five moving suburbs were north of the CBD and offered buyers housing on the more affordable fringe, Mr Sheppard said.

Coolaroo positioned 20 kilometres north of the city and with a LocationScore of 79, was a standout address for houses, he said.

“The relative demand for houses is growing, and with a median price around $470,000, it’s easy to see why buyers are looking carefully at Coolaroo,” Mr Sheppard said.

South Morang also offered a more affordable option for commuters looking at units, with rising auction clearance rates signposting the suburbs appeal, according to LocationScore.com.au

Heidelberg to the city’s west was also on the radar of buyers with appealing Art Deco homes and comprehensive retail facilities attracting buyers, Mr Sheppard said.

“Residents are well serviced in Heidelberg and it’s an easy commute to town via the train,” he said.

“Elsternwick has already garnered a reasonable amount of buyer interest as a rising star of the Melbourne property market with gentrification well and truly set in.”

Brisbane

Some analysts are predicting Brisbane will do well in 2018, Mr Sheppard said.

“With the softening in Sydney market activity coming at the end of last year, many commentators believe value-seeking investors will turn their attention to Brisbane,” he said.

It was mostly middle-ring locations that saw relative demand rise quickly, with Manly West units and Kenmore Hills houses among the most desired real estate, according to the research.

“Although Brisbane is a relatively affordable capital compared to Melbourne and Sydney, its inner-city market performed well last year,” Mr Sheppard said.

“As a result, buyers looking for reasonably priced property are considering their options beyond the 10-kilometres radius of the CBD.”

Units in Alexandra Hills, to the east of the city, were also in high demand as comprehensive facilities in this bayside suburb continue to attract purchasers.

“There’s plenty to enjoy in the Redland Bay area and with townhouses and villas priced between $250,000 and $350,000, lifestyle owners are looking to Alexandra Hills,” he said.

Adelaide

Adelaide has been an affordable offering for capital city buyers for some time now, and its appeal may continue to grow as Sydney owners look to free up equity and consider investing away from the east coast, Mr Sheppard said.

Houses in Ethelton, Aldagate and Magill saw their online search numbers ramp up, according to LocationScore.com.au

“Magill is just seven kilometres east of the city centre and has comprehensive retail and educational facilities,” Mr Sheppard said.

“Houses are very appealing with prices around the mid-$500,000s – some are even selling below the half-million mark.”

He said Ethelton is a near-city suburb with homes priced around the $450,000 to $500,000 price point.

“Not only are buyers keen to be just seven kilometres from town, this is a waterfront address that has all the lifestyle benefits that go along with being near the shoreline,” he said.

Housing in Gawler East also ranked high among the fast movers and its LocationScore of 69 marked it as a Good investment option, according to the research.

Located in the town of Gawler 35 kilometres north east of the Adelaide city centre, the suburb provides for very affordable housing, particularly for longer-distance commuters, according to Mr Sheppard.

“The attractive element for Gawler East is that vendors are discounting their asking prices,” he said.

“As vendors become more realistic about their pricing, buyers see an opportunity to get in.”

Hobart

The rise and rise of Hobart in 2017 has already been well documented, as affordability-driven buyers on the east coast mainland look to Tasmania’s lower buyin prices, Mr Sheppard said.

“Hobart had been producing good rental yields at attractive buy-in prices for the past few years, but it came into its own in 2017 with the city outperforming the major capitals on total returns and becoming a hot ticket for investors,” he said.

Located 15 kilometres north of the city and on the banks of the River Derwent, Austins Ferry housing has an idyllic outlook and easy access to town for commuters, and its LocationScore of 81 made it a Good buyer option, according to the research.

There are plenty of housing options in the suburb priced between $300,000 and $350,000, Mr Sheppard said.

“Austins Ferry was in high demand last year with a spike in online search interest,” he said.

“Its retail strip, desirable schooling and accessibility all helped drive relative demand.”

West Moonah was another interesting addition to the top five list, Mr Sheppard said.

Positioned just five kilometres from the CBD, this suburb has been growing in popularity with buyers outside the Apple Isle, he said.

“Great schools, easy access, comprehensive parklands and an engaged community are all helping drive buyers to West Moonah housing.”

Canberra

The nation’s capital can see its fortunes swing along with political ambition, but Canberra proved resilient with steady market performance throughout 2017, according to Mr Sheppard.

The city’s regimented growth seems to have resulted in steady demand for property.

“Interestingly, relative demand rose most quickly in the unit sector across Canberra,” he said.

Relative demand also ramped up in city fringe suburbs such as Ngunnawal and Banks.

“Both suburbs saw buyer demand heat up with tighter vacancy rates and lower percentage of stock on market.”

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