Affordable suburban areas could become inaccessible to buyers by 2029
There will be a substantial increase in home prices in Australia by 2029 if current growth rates persist, new analysis of PropTrack data has revealed.
If property prices continue their current trajectory, homes in traditionally affordable areas on the outskirts of major cities will likely reach million-dollar valuations, according to the property data insights provider.
Paul Ryan (pictured above), senior economist at PropTrack, clarified that the modelling is not a forecast but illustrates the extraordinary price growth over the past five years and its potential future implications.
“It highlights the exceptional things that happened over the past five years – obviously COVID, but also record low interest rates, a huge shift towards larger homes and lifestyle locations, and increasingly, affordable locations,” he said.
The analysis suggests that many suburban areas, previously known for their affordability, could become inaccessible to buyers with modest budgets if price trends continue. High-density areas with many apartments might remain affordable as their prices have not escalated as rapidly.
In Adelaide’s northern suburbs, a home in Elizabeth North currently worth about $400,000 could rise to $937,000 by 2029 if past growth rates continue. Perth’s Camillo has seen a 97% increase over the past five years, reaching a median price of $453,000. If this trend persists, a typical home could cost $892,000 in five years.
In Melbourne, Werribee South properties, currently priced at $700,000, could be valued at $1.05 million by 2029. In Sydney, Caddens homes near Penrith, currently at a median price of $1.26 million, could nearly double to $2.47 million, while Denham Court homes could rise from $1.18 million to $2.14 million.
Meanwhile, areas like Lakemba and Harris Park in Sydney and Newstead, West End, and Hamilton in Brisbane would remain relatively affordable, especially for apartment buyers, as their price growth has been slower. Suburbs like Broadmeadows, Dandenong, West Footscray, and Sunshine West in Melbourne would also stay within reach for first-home buyers.
In this scenario, high-end suburbs would become even more expensive. In Sydney, buying a home in Haberfield could require a $5 million budget, while Putney homes could approach $7 million.
Ryan noted that while these areas would continue to grow in value, the pace might not match the past five years.
“I’d be surprised if those suburbs achieve that growth again over the next five years, but over the longer period, it’s reasonable to think these suburbs will become more and more premium,” he said.
If Brisbane experiences similar growth, homes in Samford Valley, Rochedale, and Fig Tree Pocket could cost about $3 million. Middle-ring suburbs popular with families, like Oatley and Pennant Hills in Sydney, Vermont South and Wheelers Hill in Melbourne, and Robertson in Brisbane, could see median prices between $2 million and $3 million.
The PropTrack analysis also indicated that a continuation of the past five years’ growth would make coastal living significantly more expensive.
A home in Sunshine Beach, Queensland, could cost nearly $4 million, while properties in Austinmer, south of Sydney, and Lorne on Victoria’s Surf Coast, could rise to $3.6 million and $2.7 million, respectively.
However, Ryan cautioned that another doubling of home values in popular coastal areas is unlikely, though some regions will perform better than others.
“Across cities, the more affordable regions are outperforming,” he said. “I don’t see that demand waning. Whether that lasts the next five years is another question, but I definitely see that continuing over the next year or 18 months.”
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