WHEN buying a new home location is everything. And now there's research to prove it.
The St George Bank national property hotspots report has identified the top 24 suburbs around Australia likely to provide the strongest value for home buyers.
The suburbs were selected for their proximity to central business districts, transport and retail outlets, as well as renovation potential and strong pricing.
St George commissioned RP Data to undertake the nationwide analysis to determine the best value suburbs.
"Many opportunities still exist to buy well located, affordable properties in capital cities and regional areas," the report said. The cheapest suburb in the country is Redan, in the regional city of Ballarat, Victoria, where the current median house price is $190,000. Ashburton, a suburb 12 kilometres southeast of Melbourne, was the most expensive with a median price of $706,750. Related Coverage
Some of the other standout suburbs were Granville (Sydney), Chadstone (Melbourne), Keperra (Brisbane), Bassendean (Perth), and Thebarton (Adelaide). The report also found that in 2008/09 the median dwelling value across Australia's capital cities rose by 4.5 per cent. Darwin recorded the biggest rise in value, up 7 per cent in the year to June, while Adelaide recorded the smallest at 0.6 per cent.
Dwelling value in Melbourne rose 6.5 per cent, while rival city Sydney grew 5.9 per cent. Canberra was up 3.1 per cent in the year, while Perth and Brisbane grew 1.9 and 1.4 per cent respectively. "Since December 2008, Australian median dwelling values have rebounded and, as at the end of June, they sit at their highest ever (median) level of $471,818," St George Bank chief economist Besa Deda said.
The report also found the number of home loans given to owner occupiers rose 25.7 per cent in the year to July, on the back of successive interest rate cuts and two Federal Government fiscal stimulus packages. Ms Deda said the interest rate cuts and extension of first home buyers grants had breathed life into the housing market.
"The number of loans extended to owner occupiers has risen in nine of the last ten months,'' Ms Deda said. "The value of all loans retreated in June and July, but it follows six consecutive months of increases and annual growth remains buoyant at 24.3 per cent."
Between September last year and April, the Reserve Bank slashed interest rates by 425 basis points to 3 per cent, while in October last year the Federal Government boosted the first home owners grant to $14,000 for existing dwellings and to $21,000 for new properties.
However, Australia faces an undersupply of housing estimated at between 20,000 and 80,000 residences a year. Ms Deda said an imbalance between demand and supply of housing had placed a floor under dwelling values. The hotspots report found that the population grew by 406,000 in 2008, and this was likely to place upward pressure on housing prices over the medium to long term.
"With fewer dwellings being built, the supply shortage continues to be exacerbated and is anticipated to increase over the next few years as the population grows further and the required amount of dwelling commencements needed to fill this shortage goes unfulfilled," it said.
Full list of suburbs (with current median house price)
Sydney
Granville $347,500
Rockdale $525,000
Lidcombe $475,000
Riverwood $470,000
Waterloo $560,000
Melbourne
Brunswick $532,000
Ashburton $706,750
Chadstone $553,000
Flemington $530,000
Fawkner $337,500
Brisbane
Margate $347,000
Keperra $398,000
Cannon Hill $482,250
Fairfield $587,500
Kedron $480,0000
Adelaide
Thebarton $391,250
Glanville $300,000
Perth
Bassendean $445,000
Thornlie $365,000
Hobart
North Hobart $335,000
Darwin
Rapid Creek $523,000
Canberra
Dickson $505,000
Regional Australia
Gulliver $294,500
(from Townville, Qld)
Redan $190,000
(adjacent to Ballarat city centre, Vic)
Source: St George National Hotspots Report, information compiled by RP Data.
