Two suburbs in the Canberra-Queanbeyan region have taken out the top rankings in Australia for affordable locations with the highest housing forecast price growth in the next three years.
New research by property research platform sellorhold.com.au, part of the Select Residential Property Research Group, predicts that investors will be better off by more than $120,000 in the next three years if they buy houses in Charnwood in the ACT or Karabar in Queanbeyan.
By contrast, the research showed that holding on to properties with poor price potential, such as Rosebery in Darwin and Henley Brook in Perth, could cost owners dearly in just three years.
Head of Research at Sell or Hold, Jeremy Sheppard, said the research analysed suburbs with median house prices between $400,000 and $600,000 located in significant urban areas (it excluded units).
The analysis of the 15 locations with the best prospects of a price upswing over the next three years identified suburbs within strengthening major property markets.
The top five localities were in Canberra-Queanbeyan, the Gold Coast, Brisbane and Hobart.
“The Canberra-Queanbeyan region has taken out the first and second places for forecast price growth, partly due to affordable house prices close to our nation’s capital,” Mr Sheppard said.
“Both Charnwood and Karabar are near Canberra, which means housing is in strong demand from public servants.”
Mr Sheppard told Region Media that the analysis is based on an algorithm which measures more than 17 different metrics based on supply and demand and including factors such as auction clearance rates and whether properties are being discounted.
He said that there is a misnomer in property investment that exclusive areas always have higher demand when actually fringe areas or lower socio-economic areas can have higher demand because they are more affordable.
The analysis forecast that Charnwood’s median house price of $439,483 would increase by $123,520 in the next three years and that Karabar’s median house price of $525,599 would increase by $122,546.
Third on the list is Bilambil Heights in the NSW Gold Coast where investors are forecast to see an increase of $105,787 in three years, followed by Underwood in Brisbane with an increase of $97,727 and Geilston Bay in Hobart with a forecast increase of $88,949.
Mr Sheppard said that number three and four on the list were both locations in southeast Queensland, where housing affordability, location, and access to major employment nodes were some of their main attributes.
“Bilambil Heights is in the Tweed Heads region of the Gold Coast. Not only does the suburb boast water views, Surfers Paradise is also only about 30 minutes’ drive away,” he said.
“Hobart has three of the top 15 results, which shows that there is growth still remaining in the Apple Isle capital,” Mr Sheppard.
“If its name didn’t give it away, the appeal of Geilston Bay is partly due to its desirable location on the Derwent River while also only being seven kilometres from Hobart.”
Mr Sheppard said low growth forecasts were common in a number of suburbs in Darwin and Perth, which means that investors would likely be better off looking further afield.
“The research showed that vainly holding on to properties in some of these locations could see your property wealth erode every year,” he said.
“Savvy investors recognise that, even after transactional costs, they could potentially be better off by tens of thousands of dollars in a handful of years by simply literally cutting their losses.”