A trio of suburbs in one state has recorded 50 per cent price growth in just 12 months – but there could be better opportunities across the border.
The latest round of CoreLogic RP Data figures reveal the highest-growth suburbs in Australia and appear to reflect recent stories surrounding the housing boom in New South Wales. Three suburbs across the state recorded 12-month median price growth of 50 per cent, according to the latest data.
The median house price in Berrima and Coal Point, and the median unit price in Ultimo, all reflected a 50 per cent increase over 12 months according to the data.
The figure for Coal Point is based off 34 sales, with properties spending 113 days on market. For Berrima, the figure was calculated from 24 sales with properties taking 128 days to sell. Over the period 151 unit sales were made in Ultimo, with properties taking 100 days to sell.
Elsewhere, Highgate in South Australia was also a strong performer, experiencing a 49.25 per cent growth in median house price to rank it first in that state and joint fourth nationally.
Wallalong in New South Wales also returned a figure of 49.25 per cent.
In Queensland, the inner-Brisbane suburb of Tennyson ranked second in the state with median unit price growth of 45.85 per cent.
But Brisbane buyer’s agent Meighan Hetherington, director of Property Pursuit Buyer’s Agents, explained that the strong figures hide a long period of market depression following the devastating 2011 Queensland floods.
“What we saw in terms of pricing between 2011, and probably only about 12 to 18 months ago, was quite a stigma around the area,” Ms Hetherington said. “Houses were quite heavily flood-affected. Tennyson in that period had quite poor, quite negative growth from 2011 up until the current increase in market activity.”
She warned that, because of its topography, the suburb would likely be impacted by any large-scale flood events in the Brisbane area.
Investors looking to make a quick turnover on entry-level properties in particular were likely to suffer in the event of a natural disaster.
“Unless you’re a very high-risk investor I would caution against buying properties that are flood-affected or affected by high levels of overland flow,” Ms Hetherington said.
“There are some properties you can buy under $500,000 in Tennyson. They tend to be down near the train line and those were the areas most impacted by flood events – not just 2011, but the subsequent ones as well. The risk is that those properties can be negatively impacted for a three- to four-year time frame after the flood events.”.
Investors looking for a sub-$500,000 entry into the market without flood risk should look to Geebung, a suburb 11 kilometres north of the Brisbane CBD, she said.
“There’s a train station in Geebung, it neighbours a light industrial area, so good employment opportunities around there. It’s very low density, so no units, town houses, just post-war housing stock with reasonable-sized pieces of land,” she said.
Ashburton was Victoria’s highest-growth suburb, recording an increase of 39.97 per cent in its median unit price over the 12 months.
Despite the data reflecting an increase in unit prices, Miriam Sandkuhler, licensed buyer’s agent and founder of Property Mavens, explained that the primary appeal of Ashburton was the large house block sizes available to buyers and developers.
“You’ve got pretty big blocks in there, averaging 600 square metres,” Ms Sandkuhler said. “Part of the attraction is you’ve got a lot of old housing commission property and people are buying them and knocking them down and building new homes. So it’s really attracting people who are upgrading from other suburbs and want bigger properties.”
Ashburton is well served by two railway stations and in close proximity to other facilities, according to Ms Sandkuhler.
“You’ve got two or three primary schools in the area that are quite accessible, you’re quite close to a couple of little reserves and parks, you’re very close to the freeway for accessing work, extremely close to Chadstone shopping centre.”
Moving closer toward the CBD, South Melbourne ranked 10th in Victoria with median house price growth of 30.34 per cent.
Ms Sandkuhler said South Melbourne had seen immense gentrification over the past three decades and was now attracting buyers pushed out of neighbouring Port Melbourne and Albert Park.
“You’ve got people who can’t get into that Albert Park pocket who are buying borderline Albert Park on that South Melbourne side, and so they’re getting in that way,” she said.
Despite the suburb offering strong public transport links and a wide range of shops, Ms Sandkuhler cautioned investors to be wary of purchasing apartments in South Melbourne.
“South Melbourne’s had a lot of development lately, a lot of high-rise development is starting to come up in the area so more and more apartments have been approved and certainly some high-rise apartment towers have been approved so there will be a flood of stock coming into the market in time and years to come, so that’s one thing investors need to be aware of.”