House hunters in major capital cities across Australia are increasingly looking for homes in outer suburban areas according to a new report from Domain.

Domain's Buyer Demand Indicator, which tracks buyer demand for houses and apartments across Australia, shows that houses and apartments in the outer suburbs of Sydney, Melbourne, Brisbane and Perth were in the highest demand in those cities for the month up to September 6.

Domain Senior Research Analyst Dr Nicola Powell said the COVID-19 crisis has made buyers rethink where they want to live.

"The current health crisis has changed the way we use our homes, and for some altered our purchasing decisions and property wish lists,” Dr Powell said. 

“And while COVID-19 lockdowns sent buyer demand into a state of hiatus, activity from people likely to buy has rebounded in all capital cities apart from Melbourne.” 

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Domain's Buyer Demand Indicator focuses on behavioural searches to identify those who are more likely to purchase a home. 

Those “likely to buy” are classified by the actions they take on the Domain site, like shortlisting a home, sending an enquiry, completing a property inspection and frequently viewing photos and the property listing. 


The report found interest in Sydney real estate has remained strong despite property prices starting to fall and the nation entering its first recession in 29 years.

Over the four weeks to September 6, buyer demand for houses increased 9.5%, marking the steepest four-week increase since the post-lockdown double-digit rebound in May.

For units, buyer demand was a little more subdued with the indicator rising 4.5% over the four weeks to September 6.

Houses remain the most in-demand property type by far, with 89% more "likely to buy" actions than units.

"While both property types have seen a significant uplift in buy intent behaviour from property hunters, with the indicator reaching new heights, the pace of growth for houses has been greater relative to units," Dr Powell said.

"While a tree change or sea change from higher-density living has always been appealing, the need to commute into the city has been a strong enough deterrent for many."

The report found that the areas in highest demand are leafy, outer-suburban locations with bigger block sizes, bigger homes and better affordability.

"Rouse Hill-McGraths Hill and Bringelly-Green Valley are prime development areas, providing the opportunity to build or purchase new, perhaps reflecting first-home buyer demand from those seeking to take up current government incentives," Dr Powell said.


Buyer demand was weaker in Melbourne, with demand for houses dropping 13.8% and 19.7% for units.

Dr Powell said this was likely due to strict COVID lockdowns discouraging buyers from being able to go out and inspect properties.

"Demand continues to weaken in Melbourne as the strict stage-four lockdown dampens buyer activity," she said.

"The indicator has reached the lowest point since January for houses and units.

"This emphasises the impact Melbourne’s lockdown has had on real estate given January is seasonally a weak period for transactional activity, as the holiday season distracts buyers and sellers."

However, houses still remain the most in-demand property type with 135% more "likely to buy" actions than units.

The Mornington Peninsula was a top area for people likely to buy both houses and units, with the area recording some of the steepest annual increases in activity.

"Once lives return to near-normal, the commute to the office will play a less crucial role in deciding the location we reside. This may be one of the reasons for a shift in demand to Mornington Peninsula, while others could be considering a holiday home purchase as overseas travel will be unlikely for the foreseeable future and remain undesirable for some."


Demand from people likely to buy is on the rise, up 2.3% for houses and 4.1% for units in the week to September 6, marking the second week in a row activity has strengthened.

Over the four weeks to September 6, buyer demand for houses in Greater Brisbane increased 1.4% but fell 9.6% for units.

Lifestyle areas like the Gold and Sunshine Coasts remained popular among prospective home buyers.

"Some of these lifestyle regions are likely to benefit post-pandemic, with current search behaviours reflecting the increased desirability for being further from the city," Dr Powell said.

"This could be encouraged by businesses adopting the more permanent nature of working from home arrangements.

"Prospective home buyers are drawn by the lifestyle, affordability, infrastructure and opportunity to purchase a vacant block or knockdown-rebuild."

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