Good luck needed buying in Australia's 20 tightest markets
New research has identified the top 20 Australian house markets that desperately need new listings due to being severely undersupplied.
New research has identified the top 20 Australian house markets that desperately need new listings due to being severely undersupplied.
In all these markets, inventory levels are under one month, which is extraordinarily low, according to the research commissioned by HOOD.ai.
The inventory level is the amount of time it would take to sell all the houses in a particular location, if houses kept selling at the current rate and no more were added to the market.
In 13 of the 20 markets, inventory levels have fallen over the past year. In the others, they’ve remained below the one-month mark.
To exacerbate the situation, 14 of the 20 markets are tightly held, with stock turnover levels at 4.8 per cent or less. Stock turnover is the estimated share of houses in a suburb that sold over the previous 12 months.
For Australian suburbs within 200 kilometres of a capital city, the median turnover rate is 4.9 per cent.
The 20 suburbs are spread between New South Wales (10), the ACT (4), South Australia (3) and Victoria (3). All of them are within 75km of their capital city CBD.
Top 20 ranking
| Rank | State | Suburb | Postcode | Inventory level | Median price |
|---|---|---|---|---|---|
| 1 | NSW | North Sydney | 2060 | Under 1 month* | $2,400,000 |
| 2 | NSW | Dapto | 2530 | Under 1 month* | $737,000 |
| 3 | VIC | Belmont | 3216 | Under 1 month* | $735,000 |
| 4 | VIC | Highton | 3216 | Under 1 month* | $861,000 |
| 5 | ACT | Conder | 2906 | Under 1 month* | $880,000 |
| 6 | NSW | Fairy Meadow | 2519 | Under 1 month* | $1,150,000 |
| 7 | NSW | Menai | 2234 | Under 1 month* | $1,405,000 |
| 8 | ACT | Evatt | 2617 | Under 1 month* | $905,000 |
| 9 | NSW | Stanmore | 2048 | Under 1 month* | $2,150,000 |
| 10 | NSW | Corrimal | 2518 | Under 1 month* | $1,150,000 |
| 11 | ACT | Amaroo | 2914 | Under 1 month* | $915,000 |
| 12 | NSW | Freshwater | 2096 | Under 1 month* | $3,250,000 |
| 13 | ACT | Kambah | 2902 | Under 1 month* | $880,000 |
| 14 | NSW | Collaroy | 2097 | Under 1 month* | $3,750,000 |
| 15 | VIC | Croydon Hills | 3136 | Under 1 month* | $1,060,000 |
| 16 | NSW | Cromer | 2099 | Under 1 month* | $2,365,000 |
| 17 | NSW | Bangor | 2234 | Under 1 month* | $1,510,000 |
| 18 | SA | Largs Bay | 5016 | Under 1 month* | $696,000 |
| 19 | SA | Salisbury Heights | 5109 | Under 1 month* | $515,199 |
| 20 | SA | Flagstaff Hill | 5159 | Under 1 month* | $653,500 |
*The reason the report quotes an inventory level of “under 1 month”, rather than stating a specific number, is because when inventory levels are so low, the data can be very volatile and therefore using a specific number could be misleading.
Numerous reports and studies have highlighted the reality facing buyers that demand for new households will outstrip supply, threatening affordability for years to come.
HOOD.ai founder and CEO Tommy Fraser said buyers who want to move to these 20 suburbs are struggling right now, because owners just aren’t selling.
“Part of the reason Australia has been experiencing a property boom is because stock levels have been low, which has forced buyers to compete harder and bid up prices,” he said.
“That story has really played out in these 20 suburbs, where inventory levels have been incredibly low over the past year and as a result, the median house price of most of these suburbs has experienced a double-digit percentage increase over the past year.
“Buyers desperately need new stock to come onto the market in all these suburbs, because, right now, they’re in a terrible bind.
“When a house comes onto the market, do they offer a fair price and risk missing out, or do they do whatever it takes to win the property but overpay?
“It would be great to return to a balanced market, where owners enjoy reasonable capital growth and buyers have a reasonable chance of finding a property in their chosen suburb.
For that to happen, these 20 suburbs need to see a significant increase in new listings.”
For first time since June 2002, the annual increase in house prices has been higher than 20.0 per cent due in large part to the undersupplied housing market.
