Adelaide could be the next Australian city to benefit from strong suburban market prices while Melbourne suburbs continue to dominate according to new research.
Property research site LocationScore has revealed Australia’s most promising suburbs for investors to be eyeing.
Key indicators such as vacancy rates, auction clearance rates and search interest have been used to unearth the top three suburbs for rising relative demand in Sydney, Melbourne, Brisbane, Perth and Adelaide.
While Australian property might be softening in some areas, emerging demand-growth zones are sprouting across all of Australia's capital cities.
Baxter in Melbourne, Ferny Hills in Brisbane and Birkenhead in Adelaide were among the country’s best performing prospects, all sharing a median house price below $550,000.
Of all the capital cities studied, Melbourne was the clear winner with its suburbs filling out the top three spots across the 15 top prospective locations.
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The location score is based out of 100 is based on analysis of eight key indicators, which measure demand vs. supply, including Days on Market, Vacancy Rates, Vendor Discount, Rental Yields, Auction Clearance Rates, Percentage of Stock on the Market, Percentages of Renters to Owner-Occupiers and Online Search Interest.
“Rocketing demand relative to supply is an excellent gateway indication of a suburb’s potential for real estate price growth,” LocationScore director of research Jeremy Sheppard said.
“By unearthing hot demand-growth zones, investors can narrow down the search area when looking for their next investment.”
Melbourne suburbs filled out the top three spots across the top 15 national locations with fringe suburbs still eagerly sought-after commodities.
“Dingley Village housing has a very tight vacancy rate of 0.38 per cent – well below the national average of 1.72 per cent,” Sheppard said.
The south-eastern suburb also has very limited stock while the median price of $858,000 tightening supply and demand.”
Adelaide surprisingly surpassed Brisbane and Sydney in the standings coming off the back of strong demand with its ranking suburbs just behind Melbourne.
“Combined with its relative affordability, Adelaide is a city that could yield excellent outcomes for savvy investors.”
Online search interest within Adelaide remains strong, while stock numbers are tight and little movement with price and vacancy rates remain low.
Research also showed that despite negative forecasting for Sydney, there are still pockets set to continue their growth.