Australia’s top 10 investment markets revealed
Australia’s top investment markets have been revealed, and they all have the same thing in common.
Property
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Australia’s top investment markets have been revealed, and they each have the same thing in common - a lack of housing and high demand.
National real estate brand LJ Hooker analysed more than 500 regions to identify the markets with the highest undersupply of dwellings, and then shortlisted those for its Top 10 Investment Markets for 2024 report.
Topping the list was Wyndham in Victoria, where the housing supply deficit is nudging 12,600.
It was followed by Brisbane City, which has a shortfall of 12,019 dwelling, the report said.
LJ Hooker Group’s head of research Mathew Tiller said there were several leading indicators such as supply, rental growth, population growth and buyer demand that enabled investors to look ahead to gauge future opportunities.
“Picking the right time to buy, to maximise your capital growth and rental return can sometimes be tricky,” he said.
“Typically, when trying to find opportunities, major cities often grab the headlines, however, this does not tell the whole story, as all markets behave differently, driven by unique local factors and that is what we are expecting in the year ahead.”
High-growth suburbs typically share similar characteristics, the report said, including solid increases in property values, fewer days on market, rising rental yields, high auction clearnace rates and low vacancy rates.
Of the top 10 best investment spots this year, five were in Queensland, four in Victoria and one in NSW.
While the research found that every Australian state was suffering a housing shortage, Queensland was the most heavily impacted with the analysis indicating a housing shortfall of 69,000 dwelling shortage.
It was followed by Western Australia and Victoria, which have a shortfall of 27,000 and 23,000 dwellings respectively.
“Housing supply levels remain at record lows right across the country at a time when population levels have risen sharply, creating a shortage of housing across all capital cities
and regional markets,” the report said.
“The crisis in housing supply has been hardest on tenants, with vacancy rates remaining at record low levels and rental prices continuing to rise.”
The report said that targeting markets with high demand and low supply could significantly boost investors’ chances of achieving higher price growth and rental yields.
However, Mr. Tiller advises that investors must adopt a highly targeted approach, even at the suburb level.
“The state-level statistics only tell part of the story,” he said.
“When drilling down to a local government area level, the shortfall statistics provide a more tangible insight into what markets you should be targeting to capitalise on the strong demand driven by population growth.”
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The report comes after latest Regional Movers Index (RMI) revealed that Queensland remains the destination of choice for interstate and overseas migrants, with one region dominating the field.
The Sunshine Coast has surged ahead as Australia’s most coveted region for movers, capturing a record share of net internal migration over the last year.
The Sunshine Coast, Gold Coast, Greater Geelong, Moorabool and Fraser Coast all made return appearances in the RMI’s regional hotspot list, by share of net internal migration.
Sydney was again the capital that shed the most people in the last 12 months, accounting for 65 per cent of all capital city outflows, followed by Melbourne at 35 per cent.
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TOP 10 INVESTMENT MARKETS IN 2024
Wyndham, VIC
Wyndham local government area has the highest housing undersupply in the country, with a shortfall of 12,600 homes. There has been significant population growth in this region, as the State Government focuses on making it a major economic and employment centre. Williams Landing offers significant affordability to first-home buyers with median house prices sitting at $810,000 and $468,000 for units respectively.
Brisbane City, QLD
The population level has grown sharply in Brisbane over the past decade, resulting in a housing shortfall of 12,000 homes and strong price growth. Richlands is a top performer, with house prices rising by 46 per cent and units by 14 per cent over the past twelve months. It also has strong rental yields of 6.4 per cent. Other notable suburbs include Bardon and Sunnybank.
Moreton Bay, QLD
Located north of Caboolture, and one hour drive north of Brisbane, this area has a housing supply shortage of nearly 9,500 dwellings. The average house price in suburbs such as Wamuran, which saw house prices rise by 28 per cent in the last twelve months, is $1.17 million with more affordable options existing in nearby Warner and Highvale.
Melton, VIC
Melton is a major growth corridor in north-western Victoria, with a strong population growth boom driving demand for new housing, which according to the ABS has seen the local population rise sharply from 51,165 in 2001, to 178,960 in 2021. Median house prices rose by 5.4 per cent over the past twelve months, as first-home buyers driven by affordability and the desire to access space increased demand for housing.
Logan Council Area, QLD
Logan has recorded a housing undersupply of over 8,300 dwellings. Average dwelling prices range from $607,000 for a house and up to $720,000 for a unit, with a median average rental rate of $560 a week. Fast-growing suburbs include Park Ridge and Eden’s Landing.
Casey, VIC
A strong population base has led to a housing supply deficit of over 8,100 dwellings in Casey. The region covers a vast tract of outer suburban Melbourne, offering investors a significant variety of investment opportunities and suburbs. Notable performers include Cranbourne West and the wider Cranbourne catchment.
Gold Coast, QLD
Housing remains scarce in this market, with values for detached houses rising over 30 per cent in the last twelve months giving them an average value of $925,000. Broadbeach is growing in popularity with young families. Kingsholme and Hollywell have also performed strongly, and less dense and more affordable.
Ipswich, QLD
Currently showing a housing supply shortage of 6,250 dwellings. It has lower rents than inner Brisbane, averaging $330 per week for a unit and $530 per week for a house, according to CoreLogic. Notable performing suburbs include Bellbird Park, Chuwar and Springfield.
Blacktown, NSW
This area offers proximity to Sydney and Parramatta, the two largest cities in Metropolitan Sydney. Houses remain the most popular dwelling type in Parklea, with a median value of $1.4 million, which has seen significant growth over the past twelve months of 18 per cent. Schofields and Seven Hills are strong alternatives, offering more affordable entry and have recorded double-digit growth over the past three years.
City of Melbourne, VIC
The City of Melbourne is one of the densest CBD residential centres in Australia, with over 145,000 people residing in the city. Population growth, linked to offshore migration and an increasing supply of high-density housing, is favouring the CBD due to its well-connected infrastructure and access to many services. Strong growth areas include West Melbourne, Parkville and North Melbourne.
Originally published as Australia’s top 10 investment markets revealed
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