- The report represents a cross-section of diverse suburbs across Australia
- The Alice Springs suburb of Mount John is in first place
- Sydney's Oxley Park is the most poised of the capital city suburbs for units
Amid the current housing boom, which ‘lifts all boats’, there are still suburbs that may yet be poised for price growth, according to the Well Home Loans‘ ‘Green Shoots’ Report.
Released quarterly, the report identifies the top suburbs based on the strongest combination of shrinking inventory levels and days on market falls, along with an increase in asking prices over the quarter.
Scott Spencer, Well Home Loans CEO, said the report identified a cross-section of likely property markets across Australia.
“[The report] shows, 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,” he said.
The report aims to analyse key leading indicators that indicate medium-term price growth, rather than “look in the rearview mirror”.
“Inventory … 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.”
Scott Spencer, Well Home Loans CEO
“When you look closely at changes in days on market, you also get an indication of what might happen to prices in the future. 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.”
When sellers feel the market is turning in their favour, this can lead them to increase their asking prices.
The ten suburbs
The housing market of Mount Johns in Alice Springs is showing the clearest sign that price growth is around the corner, according to the report.
“Over the past three months, inventory levels have fallen 64.3%, from 9.6 to 3.4 months. Days on market have also fallen sharply during that three-month period, from 99 to 78 days. The median asking price was unchanged during the quarter, but is likely to rise in the near future,” the report said.
In terms of the unit market, Oxley Park in western Sydney is showing the strongest sign of imminent price growth.
“Over the past three months, inventory levels have really tightened, from 5.4 to 3.1 months. Days on market has also come down over the quarter, from 54 to 42 days. That’s led to a sharp rise in the median asking price, from $532,000 to $559,000.”
The remainder of the top ten varies from suburbs in capital city locations such as Glenelg and Hackham in Adelaide to Rockingham and Madeley in Perth to regional locations such as Newcastle in New South Wales and the Gympie Region, 170 kilometres north of Brisbane.
In a word of caution, Mr Spencer advised buyers not to rely solely on the report when considering where to buy, but rather to use it as a guide, considering a range of other factors while also seeking professional advice.
“The other important point is that if you are thinking about buying, it’s generally a good idea to get a pre-approval first, whether from a broker, a traditional bank or a low-rate online lender.”
“That way, you’ll have a clear idea of your budget and your offers will be taken more seriously by agents and vendors.”