Looking to invest in a property and want to know the suburbs that are currently property growth hotspots in Australia right now?
As our September 2019 property market update indicated there are signs of a recovery in housing values, though this is largely being driven by Sydney and Melbourne, where values were up 1.7% over the quarter. But dig into the data and the postcodes posting the most impressive year-on-year growth in prices are not in our two biggest capital cities.
Peruse our list and there are suburbs from all corners of the country - from Mount Pleasant in regional Victoria to East Devonport in the far north of Tassie, and Wallaroo, a port town on SA’s Yorke Peninsula.
But before we get into the countdown, let’s start by looking at how you can identify a suburb that is experiencing high growth, specifically what data indicators and factors to track when you begin your research.
How to identify a suburb with high growth potential
Shortlist your investment properties by identifying suburbs and postcodes where as many of the following factors are present, specifically:
Rising property values, preferably stable growth in house prices over a relatively short time frame - typically a few years, though it will depend how long you intend to invest for.
A declining days on market (DOM) metric, is a good sign that there is strong demand in a suburb - as properties don’t list for too long. You do need to know your local market, as DOM varies widely by market and location.
Rising rental yields, which details how much income/rent a property could fetch over a timeframe, as a proportion of its value. Rising rental yields are a good sign that there is strong demand for rental accommodation.
High clearance rates at auctions, which is detailed as a percentage of the number of properties sold over a week/month.
Low vacancy rates indicates there is strong demand for rental property in an area.
You can also track other economic indicators, like government investment in infrastructure or other job creation initiatives that will boost the local economy.
Top 10 growth suburbs in Australia right now
With this knowledge let’s cast out eye over the country’s top 10 best-performing growth suburbs, based on year-on-year performance.
1. Mount Pleasant, Victoria 3350
- Median house price: $377,500
- Annual change: +26.5%
Mount Pleasant - a family friendly suburb in the regional Victorian town of Ballarat, is the top growth suburb in Australia currently. Median house prices have climbed +26.5% over the year to June 2019. If you are investing here with a view to a rental then you will be able to collect $320 per week, with an annual rental yield of 4.4%. Over the longer term - five years - house prices have grown 7.0% in this postcode.
2. Chelmer, Queensland 4068
- Median house price: $1,207,500
- Annual change: +25.2%
Chelmer, a suburb of Brisbane 7 kilometres west of the CBD boasts frontage on the Brisbane River. This suburb is dominated by low-density houses on large blocks, which have grown +25.20% over the past year to a median of $1,207,500. Advertised rents are $652 per week, for a gross rental yield of 2.55%
3. Wallaroo, South Australia 5556
- Median house price: $260,000
- Annual change: +25.0%
Wallaroo, a port town on the western side of SA’s Yorke Peninsula 160 kilometres northwest of Adelaide is number three on our list of Top 10 growth suburbs in Australia right now. Houses have jumped +25% over the past year to a median price of $260,000 - which makes it very affordable investment prospect. Local economic activity is centred around the port which has started serving the State’s growing cruise industry. The gross rental yield is 5.54% for houses, and you can expect a weekly rent of $270 here.
4. Noosa Heads, Queensland 4567
- Median unit price: $830,000
- Annual change: +24.8%
Lifestyle property hotspot Noosa Heads on Queensland’s Sunshine Coast has the top-performing suburb - and this is where units make an appearance on our list. Median prices have increased a respectable 24.8% over the year, to $795,000 for units. Units are currently renting for $460 per week, and rental yields are 3.0%. Noosa Heads also has solid longer term growth figures, with units advancing 7.6% over the last 5 years.
5. Blackburn, Victoria, 3130
- Median unit price: $603,168
- Annual change: +24.4%
Blackburn, a family-friendly, leafy suburb in Melbourne’s east with lots of parks and good schools has proved a drawcard for buyers looking for units, which have grown +24.4% year-on-year. Median unit prices have advanced to $603,168, which rent for $398 per week with a rental yield of 2.9%. Over five years units have grown 6.3% for units.
6. Wonthaggi, Victoria 3995
- Median house price: $365,000
- Annual change: +21.70%
Wonthaggi, 137 km south-east of Melbourne in South Gippsland is a former coal town that has worked hard to evolve its economy with a wind farm, salination plant; and the popular Bass Coast Rail Track providing much needed stimulus to the local economy. The median house price has advanced +21.70% year-on-year to a median of $365,000. You can expect a weekly rent of $298 houses in Wonthaggi, with an annual rental yield of 4.2%. This is another regional market which is affordable - particularly when compared to prices in many of our capital cities.
7. East Devonport, Tasmania 7310
- Median house price: $237,000
- Annual change: +20.6%
Devonport in the north of Tasmania is riding on renewed interest from investors and people looking for an alternative to big capital cities, and the suburb of East Devonport is a beneficiary of this trend. Median property prices have advanced +20.6% to $237,000 over the last year. Houses in the suburb rent out for $260 per week, with an annual rental yield of 5.7%. Growth over 5 years is less impressive, with houses advancing +2.1%, though units have been a better bet over this timeframe, advancing +8.4%.
8. North Adelaide, South Australia, 5006
- Median house price: $961,000
- Annual change: +20.1%
North Adelaide is an exclusive postcode close to the CBD, with a mix of period houses, workers’ cottages and two-storey Victorian terraces. Median house prices have advanced 20.1% year-on-year to $961,000, and you would be able to charge in the region of $490 per week here for an annual rental yield of 2.2%. If you had invested in a house here 5 years ago it would have grown 5.8%.
9. Urunga, New South Wales 2455
- Median house price: $540,000
- Annual change: +20.0%
Urunga is a small town 27km south of Coffs Harbour where the median house price is currently $540,000. If you are a landlord here you can expect to take $380 per week rent from your tenants, for an annual rental yield of 3.7%. Houses have advanced 7.6% over five years, and you can expect a 3 bedroom house to cost $451,000.
10. Temora, New South Wales 2666
- Median house price: $292,000
- Annual change: +19.9%
Temora, population 4,054, is a small rural town in NSW’s Riverina some 80 km north of Wagga Wagga and 418km from Sydney. The median house price in Temora is currently $292,000, which has advanced +19.9% year-on-year, and where you can expect rent of $285 per week for a house, for an annual rental yield of 5.2%. Over the medium term - 5 years - houses have grown +7.1% in Temora.