With home prices increasing, it is becoming more difficult to secure an affordable home, especially close to the CBD. However, there are still a number of suburbs near the city where houses are priced competitively for their location.
According to PropTrack's July Home Price Index, house prices have risen for 19 consecutive months and are up 6.5% in the past year.
This was mainly driven by our combined capital cities where house prices are 7% higher than July 2023. In comparison, houses in our regional areas were just 5% higher.
The strong rise in house prices in our capitals is making it increasingly challenging for those who want to purchase close to city centres, with many people opting to live further away due to the higher cost of houses in these prime areas.
Despite the general trend, several suburbs near the CBD still have relatively affordable housing options, allowing buyers to find homes without compromising on budget or location.
We looked into the median sale price of suburbs within the 'inner-ring', representing the closest third to their respective CBDs, to determine where these options could be found. The analysis includes a breakdown of price by the most common bedroom configurations.
| Suburb | Capital city | Median sale price | Distance from the CBD |
| Campsie | Sydney | $1,643,000 | <12kms |
| Croydon Park | Sydney | $1,795,000 | <12kms |
| Mascot | Sydney | $1,881,000 | <12kms |
| Braybrook | Melbourne | $695,000 | <11km |
| Heidelberg West | Melbourne | $760,000 | <11km |
| Maidstone | Melbourne | $833,000 | <11km |
| Keperra | Brisbane | $885,000 | <10km |
| Chermside West | Brisbane | $901,000 | <10km |
| Chermside | Brisbane | $925,000 | <10km |
| Kilburn | Adelaide | $664,000 | <8km |
| Lightsview | Adelaide | $670,000 | <8km |
| Ferryden Park | Adelaide | $711,000 | <8km |
| Nollamara | Perth | $550,000 | <10km |
| Westminster | Perth | $560,000 | <10km |
| Cannington | Perth | $593,000 | <10km |
| Moonah | Hobart | $610,000 | <5km |
| Lindisfarne | Hobart | $680,000 | <5km |
| Lenah Valley | Hobart | $705,000 | <5km |
In Sydney, Campsie, Croydon Park and Mascot which were all within 12kms of the CBD had the cheapest three bedroom houses for sale. Their median prices for a three-bedroom house ranged from $1.6 to $1.8 million dollars in these suburbs.
Situated less than 11kms from Melbourne's city centre, Braybrook, Heidelberg West and Maidstone had the most affordable three bedroom houses within a short distance to our second largest CBD. They cost $695,000, $760,000 and $833,000, respectively, well below Melbourne's median house price of $875,000.
In Brisbane, Keperra, Chermside West and Chermside, median prices of three bedroom houses were between $885,000 and $925,000. They were the most competitively priced suburbs within 10kms of the Brisbane CBD.
Kilburn, Lightsview and Ferryden Park had the most affordable three-bedroom houses among Adelaide's inner-ring suburbs.
| Suburb | Capital city | Median sale price | Distance from the CBD |
| Earlwood | Sydney | $2,150,000 | <12kms |
| Forestville | Sydney | $2,210,000 | <12kms |
| Ryde | Sydney | $2,280,000 | <12kms |
| Altona North | Melbourne | $1,028,000 | <11km |
| Avondale Heights | Melbourne | $1,196,000 | <11km |
| Pascoe Vale | Melbourne | $1,305,000 | <11km |
| Everton Park | Brisbane | $1,060,000 | <10km |
| Chermside West | Brisbane | $1,103,000 | <10km |
| Mitchelton | Brisbane | $1,195,000 | <10km |
| Campbelltown | Adelaide | $999,000 | <8km |
| Lightsview | Adelaide | $1,006,000 | <8km |
| Magill | Adelaide | $1,223,000 | <8km |
| Redcliffe | Perth | $700,000 | <10km |
| Belmont | Perth | $743,000 | <10km |
| Morley | Perth | $749,000 | <10km |
For four-bedroom houses, Earlwood, Forestville and Ryde topped the list in terms of affordability for suburbs within the inner-third of Sydney. Houses typically sold for $2.1-$2.3 million.
Altona North, Avondale Heights and Pascoe Vale had the cheapest four bedroom houses within 11kms of Melbourne's CBD. Their median prices were $1 million, $1.2million and $1.3 million, respectively.
In suburbs less than 11 kilometres from Brisbane's city centre, Everton Park, Chermside West, and Mitchelton had the most affordable four-bedroom houses.
In Perth, Redcliffe, Belmont and Morley, four bedroom houses cost between $700,000 and $750,000, which was among the most attractively priced suburbs located within 10kms of the CBD.
While interest rates are at their highest level in over a decade, demand from buyers is still strong. New loans to investors, first-home buyers and owner-occupiers were up 25%, 8.5% and 8.1%, respectively, in the June 2024 quarter compared to the same period last year. This is likely a result of a more stable interest rate environment, which is driving confidence in the market.
On the other hand, the construction of new homes has continued to progress at a slow pace. There has been a shortfall in building completions compared to population growth and in building approvals compared to Housing Accord targets.
These are two key factors contributing to the upward trend in house prices.
We expect house prices to continue rising modestly as we move into spring. Although this may make conditions more difficult for buyers in the coming months, interest rates are forecast to fall by early next year which could provide some relief and improve affordability.
