Our housing markets experience ups and downs don't they?
Although home prices experienced a dip in 2022, it was nothing compared to the surge experienced during the pandemic when interest rates hit record lows.
Looking back over a longer period of 10 years, it is clear that almost all suburbs have experienced price growth, with some even tripling in value.
This means that over the past decade, the fortunes of Australian homeowners have greatly improved.
Home prices in Australia have increased by an average of 83% since 2013.
Regional areas have seen even higher price growth of 92%, while capital city areas have seen prices increase by 80% over the same period.
What has driven property prices in Australia?
There have been numerous factors that have driven this extraordinary growth in values.
One notable factor is the consistent downward trend of the cash rate up until the last year or so.
Since 2013, the cash rate has steadily decreased, reaching a historic low of 0.1% in November 2020. This reduction in the cash rate had a significant effect on mortgage costs, enabling buyers to enhance their borrowing capacity.
The impact of this monetary policy shift was particularly pronounced in late 2020 and throughout 2021. The surge in housing demand during this period led to a remarkable 22% growth in home prices, setting a new record.
Another significant factor is the continuous growth of the population and the scarcity of land, particularly in suburban areas near city centres.
Due to limited available land for housing development in close proximity to central business districts (CBDs), the prices of homes in surrounding suburbs have skyrocketed, making them unaffordable for a significant portion of the Australian population.
Consequently, a substantial number of individuals have chosen to relocate to regional areas and smaller capital cities, which has stimulated robust price growth in these regions.
These trends, which were already underway for some time, experienced a massive acceleration during the pandemic as remote work became more normalized.
The suburbs with the highest house price growth over the past 10 years
To gain deeper insights into the suburbs most affected by the aforementioned factors, PropTrack examined those that witnessed the most substantial growth in home prices over the past decade.
Just to make things clear, these are not necessarily investment-grade locations.
| Suburb | State | Current median price | 10-year growth |
|---|---|---|---|
| Byron Bay | NSW | $3M | +362% |
| Bright | VIC | $1.3M | +257% |
| Suffolk Park | NSW | $2.1M | +256% |
| Berry | NSW | $2.1M | +256% |
| Kingscliff | NSW | $2M | +237% |
| Buddina | QLD | $1.6M | +235% |
| Burradoo | NSW | $2.9M | +233% |
| Narrawallee | NSW | $1.1M | +228% |
| Copacabana | NSW | $1.9M | +222% |
| Glenorie | NSW | $2.8M | +220% |
According to PropTrack, Byron Bay topped the list for house price growth, with the median increasing by a whopping 362% since March 2013.
Houses in Bright, Suffolk Park and Berry were also in high demand, with prices growing by about 3.6 times over the same period.
Kingscliff and Burradoo were also among the suburbs where house prices grew the most.
The suburbs with the highest unit price growth over the past 10 years
| Suburb | State | Current median price | 10-year growth |
|---|---|---|---|
| Noosa Heads | QLD | $1.885M | +279% |
| Jindabyne | NSW | $756K | +260% |
| Currumbin Waters | QLD | $735K | +161% |
| Kingscliff | NSW | $863K | +159% |
| Ettalong Beach | NSW | $830K | +159% |
| Sunshine Beach | QLD | $1.413M | +159% |
| Byron Bay | NSW | $1.2M | +159% |
| Edgecliff | NSW | $1.55M | +158% |
| Palm Beach | QLD | $800K | +152% |
| Manly | NSW | $1.85M | +152% |
Meanwhile, PropTrack data shows that for units, Noosa Heads and Jindabyne led the pack in terms of price growth, with medians increasing by 279% and 260% respectively.
Currumbin Waters and Ettalong Beach units also grew substantially in price, now 2.6 times what they were 10 years prior.
