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Perth house prices are up, so where are the cheapest?

Western Australia's 25 most affordable suburbs, ranked nationally.

Western Australia's 25 most affordable suburbs, ranked nationally.

With Perth house prices again on the rise, an analysis has revealed the suburbs where buyers watching their pennies can get a bargain.

But the list, compiled by real estate analyst RP Data, shows Perth has far fewer affordable homes compared to other capital cities, with the cheapest suburb coming in at 389 nationally.

Meanwhile, a separate report released today shows Perth house prices have increased 1.3 per cent in the past year.

View WA's top 25 affordable suburbs in a larger map"

According to Australian Property Monitors, units also have risen 0.1 per cent.

However, sale prices declined during the September quarter (0.5 per cent for houses for 2.7 per cent for units), which is not unusual for the quieter winter months.

APM expects Perth prices to continue to rise.

Armadale and Kwinana, in the outer south areas of Perth, are the cheapest areas, according to the RP Data list.

Houses can be bought for less than $300,000 in Brookdale (median house value $264,527), Orelia ($267,647), Armadale ($270,025) and Parmelia ($273,114).

Rockingham’s Hillman (median house value $273,489) is the only other Perth suburb included in the list of WA’s 25 cheapest suburbs, with the rest in regional towns.

WA’s cheapest suburb is Moora, 190 kilometres north-east of Perth, where houses can be bought for less than $200,000.

RP Data research director Tim Lawless said across the country the most affordable city-based suburbs were typically located far from the CBD, had a lower socio-economic profile, higher than average crime rate and lower standard of housing.  

Terry Jennings, from Professionals Real Estate in Armadale, said house values in the area had declined after improving earlier this century.

“There was a stage when Armadale was very popular and overtook [prices in] Gosnells but that’s now retracted and Gosnells are higher now,” Mr Jennings said.

The area was awash with three-bedroom, one-bathroom houses that typically sold for $240,000 to $300,000.

Although the lower end of the market included “fairly rough and ready” properties, Mr Jennings said.

First-home buyers and investors were common buyers.

“First-home buyers because prices are cheaper, [while] investors who tend to target the lower end of the market because there’s better yield,” Mr Jennings said.

The national list is dominated by regional suburbs in Tasmania, South Australia and New South Wales.

31 comments so far

  • Buyers dont get bargains when prices are going up, thats a fallacy, and the sort of advertising that builds banks power and wealth, and makes homeowners lioke mice in treadmills, except for the clever marketing telling them they are winning.Meanwhile prices always go up, value goes down and the homeowners ratuio of costs to earnings gears more in favour of the employers power ,the financers power , and the sellers power..

    Date and time
    October 25, 2012, 8:27AM
    • The only difference between people believing in tooth fairies and people believing that property values go down is an age.

      Yes, you are like a mouse in a treadmill when you rent. You pay somebody else's mortgage and your rent constantly increases above the inflation rate. And you get absolutely nothing for this.

      For homeowners it is a different story - once you have bought - your mortgage decreases even if you do not pay a cent of your loan principal. Number of dollars you owe remains the same, but value of every dollar of your debt decreases with inflation. Plus the price of your home increases on average 6% above inflation. Do I have to mention that this increase is tax free?

      You shall not buy only in the case if you plan to live less than 5 years.

      Date and time
      October 25, 2012, 11:14AM
    • @ dinkumnet,most of what you say is true. Renters only get ahead if they:

      1) save the difference between renting and buying, and

      2) find a higher return for their money than from buying their own house. While a tax-free capital gain from your own house is tempting, there's an awful lot of leverage involved ($20k deposit, $400k price tag = 20:1 margin loan aka "home loan"). Just don't get margin-called. :)

      Free-thinking Aussie
      Date and time
      October 25, 2012, 1:34PM
    • @Free-thinking Aussie

      Do you know which percentage of home loans are margin called? Given the "negative equity" craze in the media, you will be surprised how close to zero the actual figure is. It is just rather an exception that reaffirms the rule: home loans almost never get margin called.

      There is very basic rationale for this. While in case of shares you very often get situation when the whole value of the company is wiped out - it is hardly possible in case of property.

      Date and time
      October 25, 2012, 3:12PM
    • Free-thinking Aussie, I've been in my house 3 years now, and my housing repayments are now less than what I would pay in rent.

      What happens if I save the difference between my housing repayments and rents now? I can't imagine how a renter could get ahead with their rents continuing to rise.

      stephen w
      Date and time
      October 25, 2012, 3:44PM
    • Thats a lot of Ifs numbnuts. What is the sky falls in like Allan from Phrahan keeps babbling about? With that sort of glass half full mentality, it's a wonder you get out of bed in morning.

      Lots of Ifs
      Date and time
      October 25, 2012, 4:02PM
    • I think you people need a lesson in finance. Who says property prices increase 6% above inflation every year on average? Who says property prices never fall? Where have you people been the past few years? And what makes you think renters get nothing in return? They get a roof over their heads - usually in a better suburb and house than they can afford to buy - and they don't pay rates, maintenance, repairs, stamp duty, commissions, or huge amounts of interest to the bank. Funny how homeowners tend to forget all the money they spend on interest payments over 20-30 years, not to mention all those other expenses that add up to owning a house. And what do they get in return? A millstone mortgage that sees them squander the best years of their lives trying to pay it off instead of being able to go out and enjoy themselves. And let's not forget: homes are paid off with after-tax dollars. If you rent and divert the difference to superannuation, for example, you save 15% tax on every dollar you salary sacrifice, your money is in a low-tax earning environment, and if you play your cards right, you can enjoy your life and buy a house OUTRIGHT with your super when it comes time to retire. No bank interest, better returns on super than property investment (if you know what you're doing), and no money-pit millstone - because houses ALWAYS cost money in upkeep and repairs.

      Cash is King
      Date and time
      October 25, 2012, 6:16PM
  • to Dinkumnet Prices go up ,but its replacement that matters to the seller.What can they buy with the money they get from their first home sale?And they need to factor in all the expenses, all the expenses, not just the purchase price and mortgage payments charges fees and stamp duties taxes, removalists, gardening costs rates and so no before they draw any conclusions.
    oOBVIOUSLY THE RENTER IS THE WORST OFF, DESPITE ALL THE ADVISORS TELLING THE OLDIES TO SELL UP AND MOVE INTO HOMEWEST OR REENTAL PROPERTIES AS THEY DID SO OFTEN , JUST PRIOR TO the last round of hyper inflation creating unrealistic outcomes (on paper_) for customers of financial institutions.

    Date and time
    October 25, 2012, 11:45AM
    • Come again?
      If you live in the house - what relevance "replacement costs" has?
      Those who bought house in Sydney in 1970 for $7000 or less - they have paid their house off ages ago and have 0 accommodation costs. However, there are plenty of people who decided to wait back then for "property crash" because property was "obscenely expensive". They pay about $600 a week for the roof above their heads.

      Those who had brains to buy an investment property in addition to that enjoy a $600 a week additional income from every house they bought.

      Where does "replacement cost" matter? Say you sell your Sydney house for $700K and buy $200K house within commutable distance from Sydney to live in. You still have half a million dollars to place in the bank and get $25K annual income. Or buy three houses for cash, and rent out two to get around $40K pa in rental income.

      Date and time
      October 25, 2012, 12:25PM
  • The only way prices can keep going up is if there isn't enough property to go round. There is NO LIMIT on the amount of property that can be supplied. If needed, we could build up and up. The housing market in this country is mismanaged by politicians at all levels. It is a form of welfare for the employed. The people who suffer most are those in the weakest position. Pay attention to your local government election and ask yourself who are the people getting in. What do their families do? I suspect that many of them are in real estate in one way or another. Why must so much of the new land sold to developers directly rather than on the free market? Does it have to be that way? Why are there is there so little affordable housing in desirable areas? Surely the laws of supply and demand should mean that the more desirable the area, the greater the supply of housing. Instead, people who do important jobs that aren't particular well paid are forced to the fringes while the wealthy occupy McMansions along the coast on blocks that could house thousands if developed as high-rise. Why isn't keeping housing affordable taken seriously? We could be innovative world-beaters if we stopped pouring our resources into housing and freed up our incomes to invent and invest in new ideas. However, the victims believe they are powerless so do nothing and the powerful fight to preserve their lifestyle. I guess you really do get what you deserve.

    Date and time
    October 25, 2012, 11:52AM

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