Hottest suburbs for price growth in 2024 - John McGrath

Price growth was generally strongest in the more affordable suburbs of the capital cities and regions last year.

CoreLogic data shows that in every capital city bar Canberra, growth was highest in the lower price quartile of the market.

A key reason for this is higher-for-longer interest rates, which continued to constrain buyers’ borrowing capacity.

This meant some buyers had to compromise on their ideal location or change their aspirations in terms of the size and type of properties they targeted.

The result was more demand in the most affordable suburbs and cities of Australia, with the best price growth in Brisbane, Adelaide and Perth.

Since the pandemic, millennial buyers seem more willing to move interstate and start a whole new life in exchange for much more affordable housing.

Two decades ago, buyers in high value markets like Sydney and Melbourne typically sought better affordability in areas further away from the CBD.

Over time, this has pushed up prices in outer ring suburbs to the point where these areas no longer provide enough of a saving for many young buyers.

So, they’re increasingly looking interstate instead, which is one of the reasons why Brisbane, Adelaide and Perth have enjoyed such significant price growth.

Reflecting this trend, Western Australia recorded the highest population growth in FY24 at 2.8%. This had a flow-on effect to home values.

CoreLogic data shows the best Australian suburbs for house price growth last year were all in Perth. Half of those suburbs had a median value below $661,000, which puts them in the lowest price quartile of the national market.

The top growth markets for apartments were in Perth, Brisbane and Adelaide, and each of the top 10 suburbs had a median price below $600,000.

Solid levels of first home buying and investor activity also contributed to high demand in the lower price quartile last year. Younger buyers and investors tend to target apartments, which have lower median values than houses.

Let’s take a look at the best growth suburbs in the East Coast capital cities and regions.

Best growth suburbs of 2024

In Sydney, CoreLogic data shows house prices rose by 19% in Bonnyrigg in the south west, 18.5% in Wiley Park in the inner south west and 17.9% in Emerton in the Blacktown area. In regional NSW, the top three suburbs were all in the Richmond – Tweed area. House values rose by 26.1% in Coraki, 23.9% in South Lismore and 22.4% in Lismore.

In Melbourne, house prices rose by 5.2% in Balaclava in the inner city, 4.5% in Beaconsfield and 4.3% in Pearcedale - both in the city’s south east. In regional Victoria, house values rose by 12.5% in Rochester in the Shepparton area, 11.3% in Red Cliffs in the north west region and 11% in Tatura, also in Shepparton.

In Brisbane, house prices rose by 24.8% in Leichhardt in the Ipswich region, 23.7% in Brisbane City and 23.6% in One Mile, also in Ipswich. In regional Queensland, house values rose by 35.9% in Rasmussen in Townsville, 35.6% in Toolooa in central Queensland and 34.6% in Barney Point in Central Queensland.

In Hobart, house prices rose by 9.2% in Moonah in the north region, 7.4% in Primrose Sands in the east and 4.7% in Risdon Vale, also in the north. In regional Tasmania, the top three suburbs were all in the state’s north west. House values rose by 16.3% in Parklands, 12.1% in Park Grove and 11.5% in Montello.

In Canberra, house prices rose by 12.6% in Whitlam in the Molonglo region, 8.1% in Gowrie in the south and 6.5% in Campbell in the east.

Looking ahead, buyer demand in the lower and middle markets is waning due to affordability challenges. The fact that interest rates did not change last year also impacted buyer confidence. This makes the first rate cut in 2025 very important for buyer morale.

The first cut will signal the beginning of a series of rate reductions, which should spur on buyers. We will likely see a spike in buyer activity with the first cut, and a more meaningful increase once we've seen three or four rate cuts.