JavaScript disabled. Please enable JavaScript to use My News, My Clippings, My Comments and user settings.

If you have trouble accessing our login form below, you can go to our login page.

If you have trouble accessing our login form below, you can go to our login page.

Home buyers priced out of capital cities

Date

Chris Vedelago

Waterloo is Sydney's most affordable inner-city suburb.

Waterloo is Sydney's most affordable inner-city suburb.

Despite the two-year old property slump, buyers continue to struggle to find homes for less than $500,000 in the inner suburbs of many of Australia’s largest cities.

That price threshold, which is more than nine times average yearly earnings, puts housing in the inner parts of Sydney, Melbourne, Darwin and Canberra all but out of reach, new research shows.

The country’s continuing problem with affordability comes despite capital city house values falling 0.4 per cent this year on the back of a 4 per cent decline in 2011, according to RP Data.

The property analyst group has identified Waterloo as Sydney’s ‘‘most affordable’’ inner suburb with a median house value of $631,830. Mascot, the tenth most affordable, is $754,718.

Melbourne, where prices fell 3.3 per cent over the year, has only one inner suburb with a median value below half a million dollars. This is the working-class but now gentrifying suburb of Maidstone, where a house is $475,318. Many once similar socio-economic areas in the city’s north and west like Footscray, Coburg and Pascoe Vale South now have house prices of up to $583,989.

In Brisbane, the most affordable suburb is Rocklea at $306,761 but prices quickly escalate above $440,000 in areas such as Virginia, Stafford Heights and Mount Gravatt.

Darwin has no inner suburban area price below $500,000, while Canberra has only three. Clarendon Vale in Hobart was the nation’s most affordable suburb with a median of $158,949.

RP Data has branded the performance of the national housing market as ‘‘comparatively weak’’ over 2012, and conditions were likely to remain ‘‘flat’’ in many – but not all – cities and regions next year.

‘‘Property markets in Sydney, Brisbane, Perth and Darwin, where home values have corrected more than the other capital cities, may be the markets to watch for improving conditions,’’ said RP data research analyst Cameron Kusher, noting signs of recovery were being seen in Perth and Darwin.

‘‘On the other hand, markets such as in Melbourne where capital gains have had a strong run are more likely to see weaker conditions.’’

The report also identified the Western Australian wheatbelt town of Moora as the best performing area in the country over the year, witnessing a 50 per cent growth in the median house value.

Meanwhile, the mining boom put rents in Port Hedland at a whopping $2300 per week. 

78 comments

  • Just thought I'd check out Moora.....

    "Moora is the largest inland service centre between Perth and Geraldton, providing services to a population catchment of 6,000 residents within a 100km radius"

    .... 6000 people within 100kms.

    current median house price quoted by RPdata is $205,000

    the median in 2009 was $195,000

    way to go ... cherry picking a tiny town to try and show huge price increases where nothing of the sort has happened! Truly embarrassing

    Commenter
    Tim
    Location
    Adelaide
    Date and time
    December 13, 2012, 3:01PM
    • I guess prices fell to below $140K and then bounced back up, because better and/or bigger houses were being sold. Which just shows that at least some of their data is largely meaningless...I suspect most of it is, but not as meaningless as this quote: "Property markets in Sydney, Brisbane, Perth and Darwin, where home values have corrected more than the other capital cities, may be the markets to watch for improving conditions.’’ So they might go up, or they might not...

      Commenter
      PhilN
      Location
      Sydney
      Date and time
      December 13, 2012, 3:44PM
    • rpdata on realestate.com reflects the median of one month only, a small sales month or an el cheapo house selling can easily give a false result. Also the 205 comes from August, we're in December and when you look at December of last year price the median price was only 123,000, so the 50% figure could actually be right.

      Commenter
      Jessica
      Date and time
      December 13, 2012, 4:10PM
  • Regarding capital cities, i believe there are 3 reasons why prices will continue to increase, 1. Gov't incentives ( FHBG,Neg-G, reduce stamp duty) 2. Introduction of 40-50 year loans (low Int%) 3.State and Local Govt fail to introduce urban density for another 10 years+.

    Commenter
    yawhoa
    Location
    Innaloo WA
    Date and time
    December 13, 2012, 3:41PM
    • you forget a main reason: Huge number of new migrants, especially rich Chinese.

      Commenter
      Will
      Location
      Melb
      Date and time
      December 13, 2012, 4:27PM
    • Will, I think you're onto something. We've been offered absolutely ridiculous amounts of money for our very ordinary, three bedroom, fibro clad home - all from Chinese buyers.

      Commenter
      jools
      Location
      Sydney
      Date and time
      December 13, 2012, 4:40PM
    • Peak was in June 2010 and the biggest falls will be 2013-2014.

      Oh and there is no shortage:

      "The so-called housing shortage, which has been used by the property industry as an excuse for Australia’s overpriced housing, has been exposed by the 2011 Census figures.

      The Census revealed that the number of households in Australia is some 1 million less than assumed by the National Housing Supply Council (NHSC) in its estimates of Australia’s housing shortage."

      www.smh.com.au/business/housing-shortage-all-smoke-and-mirrors-20120622-20szh.html#ixzz2Ets81hEe

      "Australia is not suffering from a nationwide undersupply of housing, according to Rob Sindel, chief executive of building products group CSR."

      http://www.propertyobserver.com.au/residential/no-australia-wide-housing-shortage-csrs-ross-sindel/2012052154769

      " if the occupancy rate rose to 2.9 persons per household then more than 50,000 dwellings would no longer be required. Sydney’s current population growth rate demands roughly 20,000 new dwellings per year, so one impact of a theoretical increase of just 0.1 in Sydney’s occupancy rate would be that no additional dwellings would need to be constructed for two and a half years."

      http://www.infrastructure.gov.au/infrastructure/mcu/soac/index.aspx

      Commenter
      Allan
      Location
      Prahran
      Date and time
      December 13, 2012, 5:06PM
    • The main reason is actually because people are prepared to pay that sort of money for them.

      Commenter
      Boo1
      Date and time
      December 13, 2012, 5:19PM
  • If inner suburban housing is too expensive, build or buy in the cheaper outer suburbs. That does mean putting up with the property class snobs who regard anyone living X (X is always further than where the speaker lives) kilometres outside of the CBD as a lower form of life. Getting a job somewhere in the suburbs is preferable to piling into the CBD every day, but it can be done.

    Commenter
    Michael
    Location
    Adelaide
    Date and time
    December 13, 2012, 3:43PM
    • Oh yes, and make yourself into a miserable slave to public transport, where it takes you 2 hours to travel 50 km home, because lets face it, you're not getting anything affordable within even a 30 km radius of the city.

      No thanks, been there, done that! Would rather die renting!

      Commenter
      Notaslave
      Date and time
      December 13, 2012, 4:20PM

More comments

Comments are now closed
Featured advertisers

Special offers

Credit card, savings and loan rates by Mozo

Executive Style