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Top 10 suburb picks for Australian investors

Profile photo of Andy Webb,  Editorial Writer at OpenAgent

Written by 

Andy Webb.

Learn more about our editorial guidelines.

They say a rising tide lifts all ships, as was the case throughout the 2022 property boom, but as the market turns there's going to be a lot of diversity when it comes to suburb performance. 

While some markets will struggle, others still have an especially promising future. BuyersBuyers' latest Investor Special Report highlights suburbs showing the most potential around the country, so property enthusiasts take note. 

We spoke to Pete Wargent, co-founder of buyer's agent network BuyersBuyers and one of the report's authors, to find out more about their top suburb picks and the future of Australian property.

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  • Top 10: Investing in New South Wales

    Sydney property prices are leading the current market downturn, and with interest rates tipped to continue rising as inflation surges, investors will need to be smart about their decisions. 

    Mr Wargent explained that "stamp duty reform kicks in in mid-January next year, so first home buyers won't have to pay stamp duty for properties up to $1.5 million. 

    It follows that that's going to be the best segment of the market to be in because there's going to be more there activity next year."

    With Sydney prices being so high, that typically means that, for houses, NSW's major regional locations are going to be among the best bets for investors. 

    Top 10 locations to buy a house in NSW – with a budget of up to approximately $1m

    SuburbRegionPostcodeProperty typeNo. of propertiesMedian price ($)
    CharlestownNewcastle2290House4,362$874,043
    New LambtonNewcastle2305House3,644$1,072,312
    Umina BeachCentral Coast2257House5,626$1,170,769
    Bateau BayCentral Coast2261House4,153$1,067,630
    Woy WoyCentral Coast2256House3,216$1,010,846
    UlladulllaShoalhaven2539House2,786$999,673
    Moss ValeSouthern Highlands2577House3,260$1,088,656
    MittagongSouthern Highlands2575House2,145$1,080,602
    Nelson BayHunter Valley2486House2,486$1,059,037
    Albion ParkIllawarra2527House4,134$921,756

    With rental vacancy rates at historic lows, asking rents rising rapidly and sale prices dipping, Sydney units are also offering excellent opportunities for investors. 

    "Immigration has been fast-tracked now, and there's a massive skills shortage, so there will be a lot of people around," Mr Wargent said. 

    "There will be a lot of demand for rentals which will bring investors back in. Most of the picks are driven with that dynamic in mind.

    "In terms of the locations, you're looking at a unit in the traditional low-supply blue chip areas like the Eastern Suburbs and Northern Beaches."

    Top 10 suburbs for investors to buy established units in Sydney – with a budget of up to around $1m

    SuburbRegionPostcodeProperty typeNo. of propertiesMedian price ($)
    RandwickEastern Suburbs2031Unit10,111$1,204,902
    MaroubraEastern Suburbs2035Unit6,525$1,018,000
    NarrabeenNorthern Beaches2101Unit2,664$1,332,929
    FreshwaterNorthern Beaches2096Unit2,201$1,290,867
    DrummoyneInner West2047Unit3,912$1,249,934
    Dulwich HillInner West2203Unit3,835$859,275
    Neutral BayNorth Sydney2089Unit4,958$1,398,399
    MosmanNorth Sydney2088Unit8,063$1,277,051
    Surry HillsInner South2010Unit7,587$985,685
    DarlinghurstInner South2010Unit5,893$1,172,404

    The report notes that "the best opportunities in the unit market are set to be in the established housing market rather than for expensive new builds. Look for boutique apartment blocks with a high land value content and units with a point of scarcity, such as a view."

    Down Pointer
  • Top 10: Investing in Victoria

    Much like Sydney, the Melbourne market is beginning to wind back some of the monumental gains of the recent property boom. 

    The report explains that "prior to the pandemic, Melbourne had become a global city, and its population growth was the strongest in Australia due to strong immigration. 

    "This trend is likely to resume in 2023, and Melbourne is expected to be the largest capital city of Australia over the coming decade."

    With that in mind, BuyersBuyers have picked out a variety of Melbourne suburbs expected to outperform, along with two selections from nearby Geelong. 

    Top 10 locations to buy a house in Victoria – with a budget of approximately $800k to $1.2m

    SuburbRegionPostcodeProperty typeNo. of propertiesMedian price ($)
    Burwood EastInner East3151House3,378$1,303,234
    Blackburn SouthInner East3130House2,288$1,345,287
    CheltenhamInner South3192House5,933$1,334,079
    ChelseaInner South3196House1,636$1,247,282
    HightonGeelong3216House5,915$1,024,287
    BelmontGeelong3216House4,824$811,405
    GlenroyNorth West3046House5,109$909,772
    Keilor EastNorth West3033House4,553$1,039,600
    ReservoirNorth West3073House12,556$1,025,038
    PrestonNorth West3072House9,164$1,283,961

    While houses in Victoria have outperformed units over the past decade, delivering excellent results for investors, the report notes that attached housing presents opportunities too. 

    "Family-suitable apartments in small unit blocks in popular areas, where houses are out of reach, have also delivered solid capital growth and a healthy rental return," it reads. 

    Top 10 suburbs for investors to buy established units in Melbourne – with a budget of $500k up to approximately $750k

    SuburbRegionPostcodeProperty typeNo. of propertiesMedian price ($)
    KewNorth East3101Unit5,042$848,098
    Doncaster EastNorth East3109Unit4,199$856,240
    CamberwellNorth East3124Unit3,428$854,014
    CarnegieSouth East3163Unit6,393$645,017
    Caulfield NorthSouth East3161Unit4,583$715,943
    CheltenhamSouth East3192Unit4,498$701,077
    Pascoe ValeNorth West3044Unit4,152$661,352
    GlenroyNorth West3046Unit4,350$580,354
    SpringvaleInner East3171Unit3,212$560,074
    Glen WaverleyInner East3150Unit4,325$875,777

    The report concludes that "units have underperformed houses significantly in Melbourne over the past decade, and there are some opportunities for contrarian investors to pick up a bargain."

    Down Pointer
  • Top 10: Investing in Queensland

    "The Brisbane market has been red hot over the past couple of years, so you need to be a bit careful about where and what you buy," Mr Wargent cautioned. 

    With prices around south-east Queensland only just starting to dip, steering away from the highest peak prices in the most in-demand locations could be beneficial for investors. 

    "In terms of the selections generally we're looking at median priced or below types of properties," he said. 

    "If you're looking at places like the Sunshine Coast and Gold Coast, you're generally looking away from the blue-chip areas, because they've become phenomenally expensive. Look at the secondary markets out there, places like Tewantin and Buderim."

    Top 10 locations to buy a house in Queensland –with a budget of $800k up to approximately $1m

    SuburbRegionPostcodeProperty typeNo. of propertiesMedian price ($)
    AspleyBrisbane North4034House3,999$942,448
    Wavell HeightsBrisbane North4012House3,660$1,208,391
    BrightonBrisbane North4017House3,660$875,220
    Chapel HillBrisbane West4069House3,569$1,247,925
    KenmoreBrisbane West4069House3,359$1,066,637
    RobinaGold Coast4226House5,989$1,137,119
    SouthportGold Coast4215House4,987$859,936
    BuderimSunshine Coast4556House8,978$1,120,966
    TewantinSunshine Coast4565House3,853$1,023,357
    MaroochydoreSunshine Coast4558House3,517$963,249

    While prices remain high for the state, an excessively tight rental market presents strong opportunities for both houses and units. 

    "Much of south-east Queensland is suffering from a chronic shortage of available rental stock as population growth has boomed," the report reads. 

    "There is little respite on the horizon, and we expect rental vacancies to remain extremely tight over the year ahead."

    Top 10 suburbs for investors to buy established units in Queensland – with a budget of $500k up to a maximum of $750k

    SuburbRegionPostcodeProperty typeNo. of propertiesMedian price ($)
    New FarmInner Brisbane4005Unit5,448$737,786
    BulimbaInner Brisbane4171Unit2,007$697,020
    KedronBrisbane North4031Unit1,753$432,166
    CarseldineBrisbane North4034Unit1,035$469,385
    St LuciaBrisbane West4067Unit3,203$534,313
    IndooroopillyBrisbane West4068Unit3,018$506,093
    TaringaBrisbane West4068Unit3,003$473,354
    MaroochydoreSunshine Coast4558Unit7,019$699,609
    MooloolabaSunshine Coast4557Unit4,369$726,935
    BuderimSunshine Coast4556Unit2,852$586,337

    With the Olympics coming to Brisbane in 2032, investors considering the long-term are wisely eyeing off the city as the market looks set to benefit many years beyond the Games. 

    Down Pointer
  • Top 10: Investing in South Australia

    "If you're looking at where investors have been most interested, Adelaide has been a real hotspot in recent months," Mr Wargent said.

    Both Adelaide and regional South Australia have experienced a remarkable property boom, and it's the only state where strong growth is continuing. 

    "The rental market is an absolute quagmire at the moment, it's the lowest vacancy rate ever recorded for a capital city, 0.3 per cent.

    "There are stories in the media about studio units renting for $400 a week. If rents are going to spike, that's generally going to bring investors into that market as an inflation hedge as much as anything else."

    Top 10 suburbs for Adelaide investors – with budgets ranging from $450,000 upwards

    SuburbStatePostcodeMedian house price ($)12-month price growth
    KilburnSA5015$472,50028%
    Christies BeachSA5165$460,00018%
    Hallett CoveSA5158$600,00015%
    SeafordSA5169$595,00030%
    MoanaSA5169$580,00021%
    SemaphoreSA5019$925,00010%
    Semaphore ParkSA5019$650,00014%
    ExeterSA5019$722,50030%
    ModburySA5092$491,00012%
    Valley ViewSA5093$521,00023%

    "Property in South Australia is more affordable than in other more populous states, and while interest rates are still low, it remains cheaper to buy than rent, delivering further strong demand for houses," the report reads. 

    "There is a compelling case for investors to seriously consider a suburban house in Adelaide, particularly for those mindful of their entry price and seeking an attractive rental yield as property prices remain very reasonable."

    Down Pointer

What do buyers, sellers and investors need to keep in mind? 

The market has been changing swiftly over the past few months, but the real estate cycle always brings peaks and troughs, and there may be positive news on the horizon.

"If you look further ahead, markets are actually expecting interest rates to start falling again next year. Inflation expectations over five and 10 years are already well anchored," Mr Wargent said. 

His advice is to approach things with a level head and avoid getting swept up in the wave of media negativity.

"The pandemic has driven more short-term thinking. People tend to be short-term thinkers anyway, but the pandemic has really accentuated that because things have been changing so quickly," he said. 

"I think whether you're a buyer or a seller, you probably just need to take a step back and try and think strategically — ask 'what's your 5 and 10-year strategy?' instead of responding to the next media headline, the next trend, talk about the next interest rate hike or whatever it might be."

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