Values have surged more than 30 per cent across the national top performing suburbs this year.
PropTrack analysis found that Armadale on the outskirts of Perth, saw the median home price increase 34 per cent over the past year – making it the top-performing suburb in the country.
Elizabeth North was the best-performing suburb in South Australia, where values increased 30 per cent year-on-year, while Riverview in QLD saw home prices climb 24 per cent.
Many of the top-performing markets came out of the smaller capital cities of Perth, Adelaide and Brisbane, while the more expensive areas couldn’t keep up the pace.
Other top-performing suburbs in Perth included Brookdale (34 per cent) and Camillo (33 per cent).
For Adelaide, Elizabeth Downs (27 per cent) and Davoren Park (27 per cent) were the strongest.
While in Brisbane, Acacia Ridge (22 per cent) and Rochedale (21 per cent) were the other top performers.
PropTrack Economist Anne Flaherty said lower-priced suburbs growing in value has been a key theme this year.
“If we look across every state, the suburbs that have seen the biggest price gains tend to be in more affordable areas,” Ms Flaherty said.
“We know that interest rates have increased significantly over the past 18 months, which has curtailed how much buyers can borrow.
“But at the same time, rents are rising very rapidly, so there’s probably a cohort of buyers out there who are looking for the security of owning their own home and due to pricing constraints and higher interest rates, they’re really flocking to those more affordable regions.”
Ms Flaherty said there are probably a lot of renters out there who have done the math and found that it is more affordable to buy rather than rent.
“Due to the lack of availability of rental stock and the fact that rents are growing really rapidly, they might be better off actually paying back a mortgage rather than paying out rent,” she said.
With the surge in demand for affordable housing, there weren’t many high-priced suburbs that made the list of top performers.
However, in Sydney, Clontarf saw growth of 17 per cent along with Denistone East.
Ms Flaherty said higher-priced suburbs typically saw demand at different points in the cycle compared to more affordable areas.
“I think with the higher price points, it’s often those suburbs are the ones that are the most in-demand suburbs in Australia,” she said.
“When opportunities to buy in these exclusive suburbs come up those properties tend to see strong levels of competition.”
According to Ms Flaherty, 2024 could see more of the trends that started to develop this year.
“Many of the key things that we saw emerge this year are going to continue into next year,” she said.
“We do expect that property prices are going to continue rising in 2024.
“And those more affordable suburbs are the ones that are probably going to see the biggest price gains.”
Ms Flaherty said she expected to see the two-speed market continue into next year.
“Overall, we expect stock levels to remain relatively subdued,” she said.
“And that’s going to mean that it’s going to remain quite competitive out there for buyers.”
