Top 20 Australian suburbs where house prices are set to soar

August 16, 2021

Top 20 Australian suburbs where house prices are set to soar

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9 min read

The latest Well Home Loans Green Shoots Report uses housing market insights from Suburbtrends to forecast which 20 housing markets around Australia are about to soar. Why are we so hot on these suburbs? According to the report, these 20 Australian suburbs are showing telltale signs of strong suburb price growth just around the corner.

The best news is that these top 20 ‘soon to be booming suburbs’ show great diversity. Well Home Loans CEO Scott Spencer explains that the list includes, “14 metro locations and 6 regional locations scattered around all 8 states and territories. Of the 20 locations, 12 are unit markets and 8 are house markets, catering to a variety of budgets.” He adds, “No matter where you live, there might be a nearby housing market where prices look set to accelerate in the not-too-distant future. That provides you with a potential opportunity if you’re thinking about buying.”

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How can we tell these will be the next booming suburbs?

The 20 housing markets chosen show the strongest combination of these three factors over the past three months:

inventory levels decreasing
days on market decreasing
asking prices rising

Mr Spencer explains, “this [report] analyses key leading indicators, so buyers can understand which markets are likely to show strong price growth in the medium-term,” he said.

Let’s dig into what those three key factors mean and what they say about the housing market…

Inventory Levels

Inventory level is the amount of time it would take to sell all the houses or units in a particular location, if houses/units kept selling at the current rate and no more were added to the market. So if a location had 4.7 months of unit inventory, and units kept selling at the current rate and no more units were added to the market, the backlog of units would be fully sold in 4.7 months. “Inventory levels is a really important leading indicator, because it tells you whether the balance between supply and demand is trending in favour of vendors or buyers. That’s one clue as to how prices are likely to move in the months and years ahead”, says Mr Spencer.

David Webb, Homely’s Head of Industry, reminds us that “it’s also important to analyse the inventory of the type of property that you’re looking for. Even if an area has good inventory levels, the property size or architectural style that ticks your boxes might be low in supply, which can put upwards pressure on the median asking price for that type of house.”

Days on market

Days on market is the median amount of time it takes to sell properties in a particular location. When days on market are falling, that means it’s becoming harder for buyers to find properties. This is where we can start to make predictions about housing price hikes.

Mr Spencer explains, “When days on market are trending down, it tells you buyers are being forced to fight harder for properties, which puts upwards pressure on prices.”

Mr Webb explains “Days on market can be a self-fulfilling prophecy. That fear of missing out in areas with shorter – or shortening – days on market can create panic, which makes people more prepared to ‘pull the trigger’ on houses, driving that ‘days on market’ figure down even more, and so on.”

Asking Prices

The previous two create this third factor – an increase in asking prices. The median asking price is the median ‘for-sale price’ of all the properties listed for sale in a particular location. When the median housing price rises, that suggests vendors are becoming more confident, and buyers become more knowledgeable about what they are expected to pay.

Spencer comments, “when vendors feel the market turning in their favour, they start increasing their asking prices.”

Remember, it’s important to consider a range of other factors when looking to buy and most definitely seek professional advice.

Homely’s Webb adds, “Identifying the suburb where prices are set to soar isn’t always enough when it comes to finding the perfect place to live. Using this report will help you narrow your search to suburbs with potential, but remember to look for the ‘one percenters’ that help properties prosper. Every suburb has better and less desirable streets, and styles of home that either do or don’t fit your criteria. Combining this report with Homely’s suburb reviews, Q+A section and our sophisticated search filtering will help you figure out if your next home really is waiting in one of these suburbs.”

So, here they are. Feast your eyes!

Top 20 Australian Suburbs Where House Prices Are Set To Soar

According to Well Home Loans Green Shoots Report

1. Mount Johns, NT 0870 – Houses (Alice Springs)

Of all the suburbs in Australia, the house market of Mount Johns, in Alice Springs, is showing the clearest signs that strong price growth is just around the corner.