Top 10 High Growth SA3 Regions & The Affordability Dilemma: A 2024 Perspective

Introduction

Australia's property market has undergone significant changes in recent years, with several key regions experiencing substantial price growth over the past decade. While this growth highlights the rapid appreciation of property values, it also raises concerns about housing affordability, particularly for local populations who are being priced out of these markets. This newsletter explores both perspectives: the top 10 high-growth regions and the critical affordability challenges that accompany this growth.

Top 10 Property Growth SA3 Regions in Australia – September 2024

Here’s an overview of Australia's top 10 SA3 regions in terms of property growth for houses:

1. Broadbeach - Burleigh (Gold Coast, QLD)

• Median Price: $1.815M
• Average Annual Growth: 18.6%
• Population Growth: ~1.2% p.a.

Broadbeach - Burleigh has experienced remarkable growth over the past decade. With an average annual property growth rate of 18.6%, this region is characterised by its coastal charm, high-quality lifestyle amenities, and proximity to major tourist attractions.

2. Coolangatta (Gold Coast, QLD)

• Median Price: $1.465M
• Average Annual Growth: 17.9%

Coolangatta, known for its iconic surf culture and proximity to New South Wales, has experienced robust property price growth at 17.9% per year. Its coastal environment continues to enhance its attractiveness, contributing to sustained growth in property values.

3. Maroochy (Sunshine Coast, QLD)

• Median Price: $1.3M
• Average Annual Growth: 15.9%

Maroochy has been a hotspot for families and retirees, leading to rising property values and an impressive population growth rate of 2.0% per year—one of the highest among these regions. The Sunshine Coast's growing infrastructure and lifestyle amenities are key drivers of this trend.

4. Tweed Valley (Northern NSW)

• Median Price: $1.15M
• Average Annual Growth: 15.3%

Tweed Valley offers a mix of hinterland charm and coastal accessibility, resulting in property values growing by 15.3% annually. The region is known for its natural beauty, providing a blend of rural landscapes with proximity to the coastline.

5. Robina (Gold Coast, QLD)

• Median Price: $1.26M
• Average Annual Growth: 15.2%

Robina's appeal lies in its family-friendly infrastructure and lifestyle amenities. With annual growth of 15.2%, the area has seen consistent increases in property values, largely due to its planned development and accessibility to key services and recreational areas.

6. Noosa Hinterland (Sunshine Coast, QLD)

• Median Price: $1.21M
• Average Annual Growth: 14.9%

The Noosa Hinterland offers a rural retreat close to Noosa’s beaches. Property prices have grown by nearly 15% per year, reflecting the increasing appeal of the region's relaxed lifestyle combined with proximity to coastal amenities.

7. Gold Coast - North (Gold Coast, QLD)

• Median Price: $1.22M
• Average Annual Growth: 14.7%

Gold Coast - North has benefitted from its proximity to Brisbane and the central Gold Coast, with new residential developments and infrastructure contributing to steady growth. The area's strong transport links and amenities make it an attractive location for residents.

8. Baulkham Hills (Sydney, NSW)

• Median Price: $2.239M
• Average Annual Growth: 14.7%

Baulkham Hills remains one of Sydney's premium family areas, characterised by larger homes, access to quality schools, and ample amenities. Property values have grown significantly, driven by the area's strong appeal for families and its proximity to Sydney's employment centers.

9. Young - Yass (Regional NSW)

• Median Price: $780K
• Average Annual Growth: 14.6%

Young - Yass offers a more affordable housing market compared to other high-growth regions. With a median multiple under 10 years, it remains a viable option for those seeking accessible property in regional NSW. The area's charm lies in its agricultural heritage and sense of community.

10. Mudgeeraba - Tallebudgera (Gold Coast, QLD)

• Median Price: $1.4M
• Average Annual Growth: 14.3%

Mudgeeraba - Tallebudgera offers a semi-rural environment close to the coast, attracting those who desire spacious properties while retaining access to Gold Coast amenities. The area's natural surroundings and proximity to major urban centers have contributed to its steady growth.

The Affordability Dilemma: Implications of High Price Growth

While these top 10 growth regions exhibit impressive property price appreciation, they also bring significant challenges regarding affordability, especially when analysed using the median multiple method. A median multiple above 5 is generally considered unaffordable, while multiples above 10 years—like those seen in Broadbeach - Burleigh (typically 15.9 years) and Baulkham Hills (typically 18.5 years)—indicate a severe affordability crisis.

Among the top 10 regions, only Young - Yass offers a median multiple below 10, providing some relative affordability. However, despite a typical multiple of 7.5 years in the area, homeownership remains out of reach for many locals.

The broader implications of these high growth rates are substantial. Rapid property price increases, far exceeding household income growth, are effectively pushing significant segments of the population out of these markets. First-home buyers, young families and essential workers are particularly impacted, finding it increasingly difficult to enter these high-growth regions. For instance, Broadbeach - Burleigh’s average annual price growth of 18.6% and Coolangatta’s 17.9% underscore the widening gap between property values and household incomes.

When housing becomes inaccessible, it diminishes future demand, which may impact the long-term growth of these markets. High median multiples limit the pool of potential buyers, and as younger demographics are priced out, regions risk losing the vitality and economic stability that a diverse population brings. Over the next decade, these areas may face stagnation or slower growth as affordability issues deter new buyers.

Beyond individual buyers, there are broader social and economic impacts. Rising housing costs can displace long-term residents, undermining community cohesion. Additionally, a lack of affordable housing for essential workers can create workforce shortages, affecting local businesses and public services.

Conclusion

The top 10 growth regions have demonstrated remarkable resilience in Australia's property market, but the affordability crisis casts a shadow over their success. To sustain growth, a focus on improving affordability and ensuring a balanced supply of housing is essential. Young - Yass provides a glimmer of hope with its comparatively lower median multiple, but the overall trend points to a challenging landscape for those seeking to enter the market.

Addressing housing affordability is critical to maintaining the long-term health of Australia’s property markets. Moving forward, achieving a balance between growth and accessibility will be key to ensuring these high-performing regions remain vibrant and inclusive.

Stay tuned for more insights into Australia’s property market trends and the evolving dynamics of housing affordability!