Capital city suburbs with the highest 10-year growth revealed

author-avatar By on March 05, 2020
Capital city suburbs with the highest 10-year growth revealed

Photo by Simon Rae on Unsplash

New research has lifted the lid on what suburbs in capital cities had the best average annual capital growth over the last ten years.

CoreLogic and the Property Investment Professionals of Australia (PIPA) identified Lakemba, in the Canterbury region of Sydney, as the capital city location with the highest annual growth in Australia over the past decade. 

Lakemba's house prices increased by 8.4% annually and its median house value more than doubled over the period to about $881,000. 

The second best performer was also in Sydney in the Oatlands-Dundas Valley region of Carlingford, where house values grew by an average 8.1% annually.

The median house value there skyrocketed from $662,000 to $1.41 million in that time.

Rounding out the podium finishers was Rockbank-Mount Cottrell in Melbourne's west, with a 7.9% annual average growth and an increase of almost $600,000 to its median house value. 

The table below displays a selection of variable-rate home loans on offer, featuring a low-rate pick from each of the following three categories: the big four banks, the top 10 customer-owned banks, and the larger non-banks.

Provider
Ad rate
p.a.
Comp rate*
p.a.
Monthly
repayments
 
CelebRate OO P&I ≤60% LVR
2.39% 2.39% $1,558 Go to site
2.74% 2.74% $1,631 Go to site

Base criteria of: a $400,000 loan amount, variable, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. If products listed have an LVR <80%, they will be clearly identified in the product name along with the specific LVR. The product and rate must be clearly published on the Product Provider’s web site. Introductory rate products were not considered for selection. Monthly repayments were calculated based on the selected products’ advertised rates, applied to a $400,000 loan with a 30-year loan term. Rates correct as at 12 August 2020. View disclaimer.

PIPA chairman Peter Koulizos said many suburbs situated in capital cities that had been deemed subdued had still managed to record robust growth. 

“Even though Adelaide only recorded average annual growth of 1.3% over the past decade, its top performing location of Prospect saw prices increase by 3.4% per year over the period,” Mr Koulizos said.

“Likewise, in Darwin, where prices reduced on average 1.9% annually, in Rosebery-Bellamack median house values increased by 3.2% at the same time.

“This is actually quite common, because there are submarkets within markets which operate to the beat of their own drums, usually because of consistently strong demand from buyers keen to live or invest in those locations.”

Check out the top three performing suburbs for each capital city in the table below. 

Australian capital city suburb growth over the past decade 

Suburb

Average annual 10 year growth

Median house value 2020

Indexed median house value 2010

Sydney

 

 

 

Lakemba

8.4%

$881,444

$394,504

Oatlands-Dundas Valley

8.1%

$1,441,469

$662,302

Carlingford

7.8%

$1,545,664

$728,476

Melbourne

 

 

 

Rockbank-Mt Cottrell

7.9%

$598,268

$279,684

Doncaster East (South)

7.8%

$1,263,792

$593,735

Doncaster East (North)

7.5%

$1,306,834

$636,597

Brisbane

 

 

 

Robertson

3.7%

$1,019,930

$710,160

Tarragindi

3.6%

$813,738

$571,106

New Farm

3.5%

$1,340,392

$950,745

Adelaide

 

 

 

Prospect

3.4%

$751,346

$536,483

North Adelaide

3.3%

$989,911

$718,831

Nailsworth-Broadview

3.2%

$708,291

$516,968

Canberra

 

 

 

Casey

6.4%

$698,870

$375,568

Crace

5.8%

$808,285

$460,134

Forde

5.5%

$818,003

$477,091

Hobart

 

 

 

Bridgewater-Gagebrook

5.2%

$259,149

$156,164

Rokeby

5.0%

$329,901

$203,001

West Moonah

4.6%

$453,731

$290,399

Perth

 

 

 

Riverton-Shelley-Rossmoyne

0.6%

$750,307

$708,846

Willetton

0.5%

$690,546

$659,639

Perth City

0.0%

$831,562

$834,140

Darwin

 

 

 

Rosebery-Bellamack

3.2%

$517,780

$377,709

Palmerston-South

1.6%

$435,544

$370,459

Rapid Creek

-0.6%

$591,065

$624,617

Source: PIPA, CoreLogic.

Which capital city performed best? 

Unsurprisingly, the research found Sydney and Melbourne recorded the highest average annual growth at 5.5% and 4.9% respectively, followed by Hobart at 3.4%. 

Mr Koulizos said the other capital cities recorded less than stellar average housing value growth rates over the past decade. 

“Annual growth of between 1.3% to 2.8% over the past decade is part of the reason why so many investors and property investment experts are eyeing Brisbane, Adelaide and Canberra as potentially having the best capital growth prospects over the next 10-year period,” he said. 

Darwin and Perth felt the hangover from the end of the mining boom, recording negative annual growth over the period of -1.9% and -1.4% respectively. 

CoreLogic Head of Research Tim Lawless said the research demonstrated the long-term nature of property investment. 

“Investing in the housing market is typically a long-term strategy," he said. 

"Short-term movements are less important than the longer-term trends, which typically see housing values moving through a cycle where values will rise, fall and track sideways.”

“The past 10 years has seen areas of Sydney and Melbourne outperform most other markets thanks to strong economic conditions and high rates of migration, which has fuelled housing demand, however, such high rates of capital gain have eroded housing affordability and compressed rental yields.”

Mr Lawless said it was likely the best performing markets over the coming decade would differ greatly from the previous ones. 

“Just as they were over the earlier decade where, for example, mining regions and regional coastal markets were some of the strongest performing areas."

Australian capital city growth over the past decade 

City location

State

Average annual 10-year growth

Greater Sydney

NSW

5.5%

Greater Melbourne

VIC

4.9%

Greater Brisbane

QLD

1.3%

Greater Adelaide

SA

1.5%

Greater Perth

WA

-1.4%

Greater Hobart

TAS

3.4%

Greater Darwin

NT

-1.9%

Australian Capital Territory

ACT

2.8%


Source: PIPA, CoreLogic.


Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:

  • The big four banks are: ANZ, CBA, NAB and Westpac
  • The top 10 customer-owned Institutions are the ten largest mutual banks, credit unions and building societies in Australia, ranked by assets under management in November 2019. They are (in descending order): Credit Union Australia, Newcastle Permanent, Heritage Bank, Peoples’ Choice Credit Union, Teachers Mutual Bank, Greater Bank, IMB Bank, Beyond Bank, Bank Australia and P&N Bank.
  • The larger non-bank lenders are those who (in 2019) has more than $9 billion in Australian funded loans and advances. These groups are: Resimac, Pepper, Liberty and Firstmac.

Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site.

In the interests of full disclosure, Savings.com.au and loans.com.au are part of the Firstmac Group. To read about how Savings.com.au manages potential conflicts of interest, along with how we get paid, please click through onto the web site links.

*The Comparison rate is based on a $150,000 loan over 25 years. Warning: this comparison rate is true only for this example and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.

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Alex joined Savings.com.au in 2019. He is passionate about providing Australians with the information and tools needed to make them financially stable for their futures.

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