Boat Harbour leads Australian suburbs where house prices have doubled since 2021

Property values in many city fringe suburbs have doubled with five of the top 10 performers in Greater Sydney, where homes are now averaging over $1.1m.

A perfect storm of a crippling shortage of homes and a pandemic-induced hangover has seen property values in many suburbs on the fringes of capital cities double since the pandemic.

But economists say that incredible growth is unlikely to be repeated, with a push by big business to have staff back in the office reducing the demand for people to live further away from city centres.

Data from PropTrack has revealed the majority of suburbs that have seen values skyrocket are in Greater Sydney and NSW.

Home prices fell throughout much of the past year in the wake of the Reserve Bank opting to lift interest rates, but strong demand amid record population growth and limited stock has now resulted in five months of price gains this year.

Boat Harbour in the Hunter region of NSW saw the speediest growth nationally, with median house prices jumping 102 per cent to $1,707,500 in the 16 months to May.

This was followed by Proston in South Burnett, Queensland, and Humpty Doo in the Northern Territory, which both saw values double within 20 months.

Box Hill in Sydney was one of the suburbs that have seen property prices double.

PropTrack executive manager of economic research Cameron Kusher said the strong growth in those suburb had largely been driven by a hangover from the pandemic, when people were moving to the fringes or regional locations.

“This is really an anomaly that we won’t see again,” he said. “The glory days of these areas have peaked and the desire to move further out isn’t as strong as during the pandemic, with businesses wanting people back in the ­office.”

According to PropTrack, five of the 10 top suburbs were in Greater Sydney, with Nirimba Fields in northwest recording price increase from $541,000 to $1.13m in 22 months.

Box Hill, Melonba and Grantham also saw prices double in under two years, while Vineyard near Richmond saw values increase from $2,417,500 to $5m in 24 months. All suburbs had at least 10 sales over 12 months.

Cameron Kusher from PropTrack said that such growth was not likely to be seen again.

“Growth in these fringe suburbs has largely been driven by new high-quality houses replacing outdated ones, which has driven up prices,” Mr Kusher said.

Murrays Beach in NSW and the Victorian town of Wy Yung were also in the top 10.

The strong growth comes as close to peak interest rates and limited buyer choice could see house prices reach a record high as early as January. After 10 months of declines to a low in ­December, housing costs have clawed back 1.55 per cent and are now just 2.6 per cent below their peak hit during the pandemic.

Mr Kusher said that inner and middle-ring suburbs were now pushing the rebound at the expense of those on the outskirts of capital cities.

“A lack of supply is having the biggest impact on prices,” he said. “In January we forecast values to fall 10 per cent this year, which is unlikely to happen as the shortage of homes is offsetting any ­effects from interest rates.”

The Reserve Bank has also been surprised at the resilience of the housing market, with minutes from its June meeting saying that a strong population growth had supported demand for housing and that this was largely affecting the established housing market.