Affordable suburbs in demand as buyers flock to Melbourne and regional areas
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Photo by Mitchell Luo
In a surprising turn of events, the Australian property market is witnessing a surge in buyer interest in affordable suburbs, particularly in Melbourne and various regional areas. According to an analysis by PropTrack, these suburbs are in a so-called ‘sweet spot’âoffering homes at prices still within reach for the average buyer, even as demand continues to rise.
The data, which tracks the number of enquiries per listing, highlights a growing trend: buyers are increasingly interested in suburbs where the median house price is less than $750,000. This demand is measured through high-intent actions such as emailing agents, downloading documents, or requesting inspections. “Enquiries can be a leading indicator for price growth,” said Eleanor Creagh, REA Groupâs senior economist. “If enquiries per listing are rising, it means more serious buyers are interested in purchasing properties in that suburb.”
In Melbourne, a city that has seen slower price growth compared to other capitals, the demand for affordable suburbs is particularly pronounced. “Melbourne has a very high proportion of suburbs recording increased demand, reflecting improved affordability relative to Sydney, Brisbane, and other smaller capitals,” Creagh noted. The cityâs outer north and northwest suburbs, such as Broadmeadows and Coolaroo, are attracting buyers searching for homes under $600,000. Meanwhile, those with a slightly higher budget are eyeing areas like Frankston North and Carrum Downs in the south.
Real estate agent Mark Burke from OBrien Real Estate Frankston described Frankston North as being in a ‘sweet spot’ for affordability, appealing to both investors and first-home buyers. “Thereâs still a lot of first-home buyers winning, which is good,” Burke said. “Theyâre quite often willing to pay a decent premium to do it.” He added that the area is undergoing gentrification, with many buyers competing to secure renovation-ready homes near the beach, amid increased interest from interstate investors.
The trend is not limited to Melbourne. In Darwin and Hobart, affordable suburbs are also seeing a spike in enquiries. Creagh mentioned that “almost all suburbs in Darwin and Hobart are recording stronger enquiries, which indicates demand is strengthening across those markets.” Suburbs like Karama and Wulagi in Darwinâs north, as well as Claremont and Glenorchy in Hobart, are particularly popular among buyers aiming to purchase homes under $600,000.
Derek Hart, a real estate agent from Elders Top End in Darwin, noted that affordability and proximity to the CBD are major factors driving interest in areas like Karama. “The investors are offering much quicker than first-home buyers,” Hart said. “First home buyers still want to have a look around and see whatâs out there, but if they hesitate, the investors are buying homes up pretty quickly.”
The regional areas are witnessing a similar trend, particularly in smaller cities where homes are typically more affordable than in the capitals. In New South Wales, the Riverina region has emerged as a hotspot, with suburbs like Wagga Wagga, Albury, and Griffith experiencing a surge in demand. Nathan Thomas, director of Soul Property Agents in Griffith, explained that out-of-area enquiries are on the rise. “We have a lot of the indicators that out-of-area buyers are looking for, at a price level that is achievable for most people,” he said. “Griffith has proven itself to be affordable in comparison to the major metro markets, and our median price is well below the cutoff points for first-home buyer incentives.”
In Victoria, regional centres like Bendigo, Geelong, and Ballarat are attracting attention due to the affordability gap compared to Melbourne. Suburbs such as Golden Square, Eaglehawk, and Kennington in Bendigo, and Thomson and Whittington in Geelong, have become popular among buyers. “Many of these areas are benefiting from ongoing post-pandemic migration trends, with affordability being the major motivator for many buyers,” Creagh commented.
The increased interest and investment in these affordable suburbs are expected to lead to higher competition among buyers, potentially supporting price growth in the future. As more Australians look for affordable housing options, these ‘sweet spot’ suburbs are likely to remain in high demand.