Despite the fact that Sydney has the highest median price of Australia’s capital cities, did you know that it also has some of the cheapest houses in the country?
Australian Property Monitors recently reported that while 122 Sydney suburbs have a median house price of more than $1 million, the harbour city also has the largest proportion of cheaper homes of any Australian capital.
In fact 150 Sydney’s suburbs (23.5% of them) have a median price of under $400,000, compared with 13 per cent in Melbourne, and 20 per cent in Brisbane and Adelaide.
The interesting thing is that lately there has been a call for more affordable properties, but there’s nothing new about affordable properties being available in Australia.
The problem is most of want to live in the suburbs close to the CBD and this makes them unaffordable.
Why is there such a spread in Sydney house prices?
One reason for this spread of prices is Sydney’s geography.
Suburbs on the fringe are much further from the city centre than in other capitals and this distance is proving too great for many Sydney buyers.
For example, the average distance from the CBD of these sub-$400,000 suburbs is 52 kilometres in Sydney, compared with 36 kilometres in Melbourne and 30 kilometres in Brisbane.
Not only is there a disparity in Sydney housing prices, but there is also a vast difference in how the various segments of the Sydney property markets are performing.
While there is cheap accommodation in the outer Sydney suburbs, like I said, that’s just not where the majority of people want to live. And that’s why prices in many of Sydney’s outer suburbs have not performed anywhere near as well as many of the inner suburbs.
Such is the demand for Sydney’s inner-city suburbs, those about 10 kilometers from the CBD, that none of them had a median house price below the overall Sydney median of $638,000.
And this trend is likely to continue in 2012 when Sydney is again likely to be Australia’s best performing property market (as it was in 2011).
While not all Sydney properties will perform well, I see Sydney’s inner west and eastern suburbs once again outperforming the averages as supply can’t meet demand form owner occupiers or tenants.
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