The prices homebuyers pay now may pale in comparison to what they will pay in just five years. Photo: Tim Hunter.
Australia is on the brink of a property divide like never before, with explosive figures warning that values in many suburbs will double by 2030, while other areas brace for huge price falls.
The surprising findings come from PropTrack models, which predicted what houses in every capital and suburb would cost in 2030 if recent growth patterns returned.
The picture is terrifying for anyone still trying to crack the real estate market.
Economist Angus Moore from the REA group said prices are not done rising yet.
He noted that if prices continued to grow at the same rate as the past five years, buyers in Sydney would pay about 61 per cent more in 2030, 68 per cent more in Brisbane and 75 per cent more in Adelaide.
Prices in Melbourne would be 17 percent higher, in Perth prices would increase by 66 percent and in Hobart and Canberra the increase would be about 40 percent.
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High-stakes auctions have put pressure on homebuyers to pay more. Photo: Sam Ruttyn
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Mr Moore said the modeling was not a prediction but highlighted “how strong the last five years have been, especially for what were once affordable markets”.
SYDNEY
If you think Sydney real estate is expensive now, brace yourself: the average house price is on track to reach $2.4 million by 2030 – almost $1 million more than today – if the recent five-year pattern repeats.
PropTrack’s suburb-by-suburb breakdown shows some areas are on track for price doubling, propelling Sydney’s affordability crisis into uncharted territory.
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Units in Sydney, where there is a greater supply, are likely to have performed worse than houses.
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Another half-decade like 2020-2025 would more than double house prices in Sydney – despite the cities having similar population densities. Prices in Sydney would also be almost a million dollars higher than in Brisbane, even if the growth spurred by the Olympics is expected there.
The number of units is expected to increase by only about $80,000 over the next five years.
Moore said Sydney’s growth came from a cocktail of chronic supply shortages, booming population growth, strong employment and upgraders armed with new shares.
Suburbs on track to double include Sylvania Waters, Waverley, Warrawee and south-west areas such as Denham Court, Oakdale and Leppington.
MELBOURNE
In Melbourne, it’s the family-friendly suburbs, not the luxury enclaves, that are poised to flourish.
PropTrack’s modeling showed Lower Plenty, Diamond Creek, Beaconsfield, Romsey and Mentone outperformed blue chip Toorak, where the average house price is currently around $4.71 million.
Toorak is tipped to win $220,000, but the suburbs could make a jump of $350,000 or more.
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In many Melbourne suburbs, prices can rise above $1 million.
More than 50 new suburbs are on track to join Melbourne’s multi-million dollar club within the next five years, including Taylors Hill, Berwick, Reservoir, Altona North and Heidelberg Heights.
Buyer advocate Emily Wallace said the shift was a reflection of families looking for space. “Not necessarily first-home buyers, but homebuyers who want a yard for the kids.”
Melbourne’s average home price, based on sales of townhouses, houses and units, is expected to rise above $1 million by 2030.
Mr Moore said Melbourne’s slower growth was a result of faster house building.
BRISBANE AND GOLD COAST
Queensland is set for the most eye-watering rises of all.
The average home price is on track to rise 84 percent to $1.53 million by 2030 if the past five years repeat.
Brisbane has already become Australia’s most expensive capital after Sydney, and more growth would push the market even further ahead of most of the country.
Prices could double in some suburbs, especially in Logan, Wide Bay and Central Queensland.
Twelve of the state’s current cheapest markets are expected to have prices around $1 million by 2030. Logan’s Kooralbyn is one of the standouts: units could rise from an average value of $291,000 to $946,000, an increase of 225 per cent.
Queensland’s prestigious suburbs were expected to see extreme increases, with Surfers Paradise homes expected to cost an average of $9 million over five years, while Mermaid Beach would cost $6.4 million. Prices in the Brisbane suburb of New Farm are said to be $5.26 million.
Prestige agent Russell Rollington said $9 million for Surfers Paradise was “ambitious but possible”. He cited a recent sale of sub-penthouses worth $7 million, which was more than double the 2020 price.
ADELAIDE
According to the report, if history repeats itself, Adelaide’s average house price could rise from the current median of $841,000 to as much as $1.464 million, based on the 75 per cent growth it has shown over the past five years.
Those looking to buy a unit will also need a significantly larger down payment as unit prices rise 64 percent over the past five years. The average unit price would rise from the current $573,000 to an eye-watering $938,000.
Adelaide was once one of the most affordable cities, but has become one of the more expensive.
Homes in Adelaide are said to be the third most expensive in the country with an average value of $1.47 million, behind Sydney at $2.4 million and Brisbane at $1.54 million.
Homeowners in Adelaide’s northern suburbs appear to be the biggest winners.
Another 209 percent increase – the growth we’ve seen over the past five years – would bring Davoren Park’s median to $1,578 million.
Elizabeth North and Elizabeth Downs homes were not far behind, with prices rising 197 percent and 193 percent respectively.
HOBART
About half of Hobart’s suburbs would have a median house price of $1 million by 2030 if growth trends were to repeat in five years. These included Dodges Ferry and Rokeby.
The average house price in Hobart for the entire city would be $1 million and the average unit price would be $738,000.
DARWIN
House prices in Darwin would average $756,000 by 2030 and unit prices in Darwin would average $451,000.
Home prices in the area are expected to rise by as much as 107 percent by 2030 if the pandemic price surge is repeated.
Muirhead’s housing market is expected to be the best performer in 2030, with 107 percent growth over five years and an increase in the average house price from $730,000 to $1,512 million, based on trends since the pandemic.
Economist Angus Moore from the REA group said more housing supply is needed to moderate prices.
Meanwhile, in Dundee Beach, the average price of a home would likely be $564,000, a 66 percent increase from the current median of $340,000.
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