A new list of 24 property hotspots shows there are still opportunities to pick up undervalued properties, despite the fact median house prices sit at all-time record levels.
The report, commissioned by St. George Bank and prepared by property research firm RP Data, focuses on suburbs which a well priced when compared to nearby and comparable locations, have good potential for renovation and are well located to transport and retail amenities.
St. George Bank’s chief economist Besa Deda says that while Australian house prices have quickly recovered their losses of the last two years, capital cities have shown substantial variation in house price growth and smart buyers can still find bargains.
“In each city there are areas that have been overlooked by property buyers, despite positive factors that actually make these locations attractive spots for home owner-occupiers or investors,” she says.
Get daily business news.
The latest stories, funding information, and expert advice. Free to sign up.
“Savvy home buyers and investors should look outside the square and consider the areas which have not attracted the same level of attention as traditional blue-ribbon locations. For example, some of the suburbs identified in the research include light industrial areas which are expected to eventually transform into residential areas with amenities.”
Deda says that one of the big drivers of the housing market over the longer term is population growth and says that while migration has been cut in the last 12 months, most estimates point to a housing shortage of between 20,000 and 80,000 dwellings a year.
“There are important demographic fundamentals that shed a favourable light on the prospects for residential housing lending and prices over the medium- to long-term. Population growth nationally is running at its fastest pace in 40 years at a time when there is a national shortage of housing.”