Top 20 worst suburbs
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  • New research unveiled top 20 suburbs investors should avoid, due to rising inventory levels and days on market
  • WA not the place to be it seems, earning 10 and 6 positions on the housing and unit market rankings
  • Investors should avoid these markets in favour of alternatives offering superior growth, says Veronica Morgan

New research commissioned by Suburb Help, and conducted by Suburbtrends, has revealed the top 20 Australian suburbs that investors ought to avoid.

The findings, released in the quarterly Suburb Help Where Not to Invest Report, compiled a list of all Australian suburbs with a legitimate and soft property market.

The resulting rankings evaluated both the housing and unit markets, with Western Australia and New South Wales over represented in each respectively.

Rising inventory levels and days on market telltale signs

Suburb Help chief property strategist Veronica Morgan said that as interest rates continue to rise, it’s pertinent that investors identify and avoid areas unlikely to give them a strong return on investment.

“The reason property investors should avoid the suburbs in this report is not necessarily because they’re bad locations but because they’re bad locations as of May 2022.”

Veronica Morgan, Suburb Help

Ms Morgan added that some suburbs crowned among Australia’s worst have performed underwhelmingly for a long time, while others may see the tides turn in the future.

“Right now, though, I’d advise property investors to avoid these markets, because there are much better alternatives,” she said.

The suburbs that made the ranking all had two factors in common, making for an unfavourable combination – rising inventory levels and rising days on market.

“When you put those data points together, it suggests that prices in these locations will
either grow slowly in the medium-term, or go backwards. By contrast, there are other
locations in Australia that will deliver superior price growth,” Ms Morgan added.

Veronica Morgan Suburb Help
Veronica Morgan, Suburb Help chief property strategist. Image supplied.

Top 20 worst housing markets for investors

While Perth residents can often be found celebrating living in Australia’s most affordable capital cities, this latest news may not garner cheers from investors.

Western Australian suburbs earned half of the positions on the top 20 worst suburbs leaderboard for the housing market.

Surprisingly, the state still avoided top spot with the Victorian suburbs of Yarrawonga and Diggers Rest taking gold and silver medals.

Only three suburbs had an inventory level – that is, the amount of time it would take to sell all the houses in the suburb – that surpassed 12 months. The report indicated that in suburbs with inventory levels this high, the data is volatile and hence could not result in a reliable prediction.

Number of listings ranged from just 16 houses to 92.

Top 20 ranking (houses)

Rank State Suburb Postcode Inventory Level Listings
1 VIC Yarrawonga 3730 6.9 months 92
2 VIC Diggers Rest 3427 Above 12 months 79
3 WA Girrawheen 6064 7.8 months 62
4 WA Yokine 6060 8.8 months 56
5 WA Midland 6056 10.8 months 54
6 WA Rivervale 6103 7.6 months 41
7 WA St James 6102 8.8 months 36
8 WA South Guildford 6055 6.5 months 36
9 NT Zuccoli 0832 10.1 months 34
10 WA Riverton 6148 6.6 months 29
11 NT Bellamack 0832 8.2 months 27
12 WA Lynwood 6147 7.5 months 26
13 NT Bakewell 0832 8.6 months 26
14 NT Woodroffe 0830 7.2 months 26
15 WA Cockburn Central 6164 Above 12 months 23
16 NT Driver 0830 6.5 months 21
17 NT Johnston 0832 6.9 months 19
18 WA Waterford 6152 Above 12 months 18
19 VIC San Remo 3925 6.7 months 18
20 NSW Vineyard 2765 Above 12 months 16

Top 20 worst unit markets for investors

In the unit market however, New South Wales received a remarkable 11 positions on the ranks while Western Australia still earned a noteworthy mention of 6 suburbs.

Paramatta and Sydney were crowned the top two worst markets, with 281 and 236 current listings respectively.

Suburbs with inventory levels above 12 months were significantly higher in the unit market. 10 of the suburbs had immeasurably high inventory levels, while listings ranged from 22 to 281.

Top 20 ranking (units)

Rank State Suburb Postcode Inventory Level Listings
1 NSW Parramatta 2150 10.7 months 281
2 NSW Sydney 2000 Above 12 months 236
3 WA East Perth 6004 9.9 months 234
4 WA Perth 6000 11.5 months 221
5 NSW Rouse Hill 2155 Above 12 months 159
6 NSW Lidcombe 2141 Above 12 months 130
7 NSW Homebush 2140 Above 12 months 130
8 NSW Mascot 2020 Above 12 months 122
9 VIC West Melbourne 3003 Above 12 months 116
10 WA Subiaco 6008 7.8 months 95
11 NSW Sydney Olympic Park 2127 Above 12 months 86
12 NSW Canterbury 2193 10.6 months 62
13 NSW Haymarket 2000 Above 12 months 60
14 WA Mosman Park 6012 9.6 months 58
15 NSW Cabramatta 2166 6.8 months 56
16 WA Nedlands 6009 Above 12 months 54
17 NSW Arncliffe 2205 Above 12 months 48
18 NT Parap 0820 9.1 months 32
19 WA Jolimont 6014 10.9 months 27
20 VIC Notting Hill 3168 10.6 months 22

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