Unless you’ve been in hibernation for the last couple of years, you’ve probably noticed that housing prices in Australia are pretty high, especially if you live in Sydney or Melbourne.
Last year in Australia, the average house price rose by 2.4 per cent to $658,608, with Sydney having the highest median house price, which rose 4.9 per cent to $929,842 followed by Melbourne at $688,000 with a 3.5 per cent rise.
While prices in the rest of Australia are also quite high, Melbourne and Sydney definitely take the cake for being the most expensive. If you’re after a bargain, Hobart is the place to go. With a median price last year of only $382,500 despite a rise of 6.3 percent, Hobart could not only be an ideal place to settle down, it’s also a good investment opportunity, with the last few years seeing a steady increase in property growth.
For the rest of the country, Darwin comes in at the third most expensive (which I actually found surprising) at $625,000, followed by the country’s capital at $560,000. Among some of the cheaper options is Brisbane, at $475,000 and Adelaide at $425,250, both of which saw little or no increase. In fact, in 2015 Brisbane was actually down 1.5 per cent.
There’s no denying that Melbourne and Sydney are sought after city’s, however, where you buy plays a big role in determining how much bang you get for your buck. It’s important to be aware of supply stocks and demand in the area you’re looking to invest in. For example, if there are a number of residential developments going on, will there be enough demand to drive prices up? It’s best to consult a property expert if you need advice.
Further into Melbourne’s South-East, North and Western suburbs, there has also been a massive boom in residential developments with housing estate’s popping up left right and centre. There has been much debate over whether these properties will see a good return in the long-run because of their prevalence, but they are definitely a more affordable option for first homebuyers or retirees.
It’s estimated that Australian housing is 40 per cent overpriced when compared to incomes and the cost of rent. In Paramatta (20km from the CBD) for example, the average house is valued at $1,030,000 to buy or $420 per week for a two-bedroom rental.
On the other end of the spectrum, some Sydney suburbs have been named the cream of the affordable crop. Lalor Park and Kings Langley in the city’s west, Menai in the Sutherland Shire and Blaxland at the foot of the Blue Mountains are some of the most affordable suburbs in terms of house prices.
In Lalor Park you can get a three-bedroom home for as little as $610,000, well below the New South Wales average of almost a cool million. While this may not be as cheap as Hobart, and not on the doorstep of Sydney’s thriving metropolis, it’s still a viable, affordable option for buyers and investors.
The verdict; Sydney and Melbourne have a steady property market with high prices, but good returns, while the rest of Australia proves to be more economical in terms of price, and for the most part still enjoys a steady market.