25 affordable hotspots where home prices are leading the charge
Affordability and attractive investment returns have been driving home buyers and property investors to the regions or outer city fringes, with 25 outperforming hotspots emerging across the country.
The latest PropTrack Home Price Index shows national property prices reached a new record high in August, but beyond the headline there are pockets in each state where prices are growing even faster.
Analysis of the hottest SA4 regions in each state has revealed affordability is the key ingredient behind the outperformance over the past 12 months, with some prices in some locations growing four times faster than their respective capital city or region.
There are 107 SA4 regions across Australia, which are geographical areas defined by the Australian Bureau of Statistics with a minimum population of at least 100,000 people. They’re typically larger than local government areas (LGA) and sometimes have similar names, although the borders differ.
Jump ahead to see the top performing areas in:
These booming markets are scattered throughout metropolitan and regional areas of Australia, but the majority of them offer relatively affordable housing or enticing investment potential.
For example, while Melbourne recorded annual price growth of 2.1% in August, median home values in the city’s north west grew by 7.9%, outperforming the capital city growth rate by almost four times.
It was a similar story in Sydney, with homes in the city’s south west growing by 8.0% over the year compared to 3.7% across the whole city.
And regional Queensland’s solid growth rate of 9.9% was left behind by Townsville’s nation-leading 17.6% price jump over the past 12 months.
REA Group senior economist Eleanor Creagh said affordability remains an important factor for home buyers.
“More affordable regions have outperformed over the past year, with strength in home buying demand buoyed in these regions as buyers push down the price curve,” she said.
“With three RBA rate cuts delivered this year and further reductions expected, borrowing costs are easing, sentiment has improved, and demand is rebuilding as we head into the spring selling season.”
Queensland: Investors flock to the far north
The Townsville region in far north Queensland led the way not only for the sunshine state but also for Australia, with the annual median home price jumping 17.6% to $569,000 in August.
Capital city and regional price growth
| Queensland | Annual price change | Median home price |
| Brisbane | 9.6% | $936,000 |
| Regional QLD | 9.9% | $738,000 |
Home price growth has already been strong in Brisbane and the rest of Queensland, where annual median home prices were up 9.6% and 9.9%, respectively.
Top 5 outperforming locations in QLD
| Location | Annual price growth | Median dwelling price | ||
| 1 | Townsville | Rest of Qld | 17.6% | $569,000 |
| 2 | Mackay – Isaac – Whitsunday | Rest of Qld | 14.7% | $565,000 |
| 3 | Central Queensland | Rest of Qld | 14.3% | $547,000 |
| 4 | Toowoomba | Rest of Qld | 14.2% | $697,000 |
| 5 | Wide Bay | Rest of Qld | 11.5% | $622,000 |
Kody Dart, real estate agent at Belle Property Townsville City Central and Beaches, said home prices in Townsville had been rising rapidly, but they were still relatively affordable compared to southeast Queensland.
“There is a lot of money being pumped into the town right now, with a lot of new infrastructure, so the building industry is going bonkers,” he said.
Mr Dart said infrastructure projects such as the expansion of the Port of Townsville was boosting confidence in the city.
Townsville also has a significant defence force base, and Defence Housing Australia had been investing in additional housing in the region, he said.
“One of the main issues is supply and demand because we just don’t have enough houses to support the population growth here,” he said.
“We have seen an influx of investors – everyone is jumping into Townsville to get on the capital growth train.
“I think we’re going to be extremely busy with constant growth for at least the next 12 months.”
New South Wales: Families descend on affordable hotspots
The Sydney South West region, which includes Liverpool, Austral and Oran Park led the way in New South Wales with 8% annual home price growth to a median $1.12 million.
Capital city and regional price growth
| NSW | Annual price change | Median home price |
| Sydney | 3.7% | $1,201,000 |
| Regional NSW | 4.4% | $734,000 |
The region outperformed median home price growth in Sydney and the rest of the state, where prices rose by 3.7% and 4.4%, respectively.
Top 5 outperforming locations in NSW
| Location | City or region | Annual price change | Median home price | |
| 1 | Sydney – South West | Capital city | 8.0% | $1,178,000 |
| 2 | Murray | Regional NSW | 7.8% | $484,000 |
| 3 | Far West and Orana | Regional NSW | 6.7% | $321,000 |
| 4 | Hunter Valley exc Newcastle | Regional NSW | 6.5% | $712,000 |
| 5 | New England and North West | Regional NSW | 6.4% | $442,000 |
Bjay Paul, real estate agent at Raine & Horne Leppington-Austral, said families were heading to the southwest in search of affordable housing.
“It’s an affordable area and it has been for some time, so the flow of buyers has been quite significant compared to other areas,” he said.
“So many people have been pouring into this location, so demand has been growing and when demand rises, so do prices.
“There’s been a lot of growth here and a lot of infrastructure and amenities have come to the area such as schools, shopping centres and road upgrades.”
“A lot of families move here because they want to grow their family, and they want to be able to buy a house with a backyard.
“Prices are going to continue to rise here, and I think it may become unaffordable at some point.”
Victoria: Regional hotspots lure property investors
In Victoria, the median home price in the North West region, which includes Mildura and Horsham, rose 7.8% to $391,000 during the year to August.
Capital city and regional price growth
| Victoria | Annual price change | Median home price |
| Melbourne | 2.1% | $830,000 |
| Regional Vic | 2.6% | $561,000 |
The region outperformed the annual median home price in Melbourne (2.1%) and the rest of Victoria (2.6%).
Top 5 outperforming locations in Victoria
| Location | Annual price growth | Median dwelling price | ||
| 1 | North West | Rest of Vic. | 7.9% | $391,000 |
| 2 | Shepparton | Rest of Vic. | 5.2% | $472,000 |
| 3 | Bendigo | Rest of Vic. | 4.3% | $599,000 |
| 4 | Ballarat | Rest of Vic. | 4.2% | $534,000 |
| 5 | Melbourne – North West | Greater Melbourne | 4.2% | $742,000 |
Brenton Love, real estate agent and director at Barry Plant Mildura, said affordability and strong rental yields were driving property investors to the north west region.
“We are seeing a lot of investors coming here from outside the area,” he said.
“We still have a lot of owner occupiers, whether they are first-home buyers or people upgrading, in the market, but they are competing against a lot of investors.
“Affordability and rental yield are the two driving forces for us – there’s a shortage of rental homes here and rents are rising.
“It’s also relatively affordable to buy a house here compared to somewhere like Melbourne, so people are seeing better value for money here.”
“Local buyers who are trying to enter the market are really battling at the moment because it’s so competitive.”
“I think we’ve got another 12 months of really high demand and a lack of supply.”
Hotspots around the rest of the country
In South Australia, the median home price in the state’s south east region, which includes Mount Gambier and Murray Bridge, soared 14.0% to $525,000 during the 12 months to August.
Capital city and regional price growth
| South Australia | Annual price change | Median home price |
| Adelaide | 9.0% | $853,000 |
| Regional SA | 13.3% | $467,000 |
It surpassed the 9.0% and 13.3% growth in annual median home prices recorded in Adelaide and the rest of South Australia, respectively.
Top 5 outperforming locations in South Australia
| 1 | South Australia – South East | Rest of SA | 14.0% | $525,000 |
| 2 | Barossa – Yorke – Mid North | Rest of SA | 13.4% | $474,000 |
| 3 | Adelaide – South | Greater Adelaide | 10.2% | $883,000 |
| 4 | Adelaide – North | Greater Adelaide | 9.7% | $741,000 |
| 5 | South Australia – Outback | Rest of SA | 9.7% | $321,000 |
The Western Australia Wheat Belt region, home to suburbs like Northam and Narrogin, saw the strongest median home price growth in the state for the year to August.
Capital city and regional price growth
| WA | Annual price change | Median home price |
| Perth | 9.2% | $865,000 |
| Regional WA | 9.9% | $559,000 |
Top 5 outperforming locations in Western Australia
| 1 | Western Australia – Wheat Belt | Rest of WA | 13.6% | $527,000 |
| 2 | Western Australia – Outback (South) | Rest of WA | 11.2% | $425,000 |
| 3 | Mandurah | Greater Perth | 11.2% | $736,000 |
| 4 | Perth – North East | Greater Perth | 10.5% | $833,000 |
| 5 | Perth – South East | Greater Perth | 9.9% | $816,000 |
Median home prices were up 13.6% to $527,000 in the region, compared to 9.2% in Perth and 9.9% for the rest of WA.
In Tasmania, where there are just four SA4 regions, the West and North West region which includes suburbs like Devonport and Wynyard saw the strongest home price growth in the state.
The region’s median home price jumped 5.3% to $494,000, compared to 3.1% in Hobart and 4.3% in the rest of Tasmania.
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