The most affordable inner city suburbs: RP Data’s city by city reveal

Looking at where the most affordable dwellings are within 10 kilometres of each city’s CBD, RP Data’s research analyst Cameron Kusher paints an intriguing picture of each state and territory’s apartment markets.

The list, which spans from Sydney’s cheapest, Wolli Creek for a $710,303 median house price, to Hobart’s Clarendon Vale, for a $159,159 median house price, includes the five most affordable suburbs for houses and units within each capital city.

Kusher notes that investors and owner occupiers may be surprised by the data, which suggests affordable inner city options exist.

“We’re witnessing a familiar trend across most cities where demand for housing is particularly strong across the inner city areas of the city,” said Kusher.

“With low mortgage rates, buyers are battling it out to purchase homes close to the city centres - of course areas closer to the CBD tend to be much more expensive than those areas further away.

“Inner city suburbs are also generally better serviced by both essential and desirable amenities such as schools, medical services, shopping centres, social amenity, roads and public transport infrastructure,” he said.

He explained that in Sydney and Melbourne the cost of housing remains expensive, even on this cheapest list, due to high demand and low supply. While units are an alternative to houses for some to access the market, there are still restrictive price points.

He also noted that the cheaper areas that emerged on the list are often seen as less desirable, but are in urban renewal areas. For this reason, he suggests that home values may increase as mortgage rates remain low and buyers are priced out of houses.

“This scenario creates good opportunity for other city areas - if buyers can’t afford to purchase a home within the inner city, they will most likely look to those locations that tick as many of the inner city boxes, just at a lower price point than the inner city areas,” he said.

“Given this, suburbs featuring quality public transport connections, abundant retail and social amenity, quality schools and medical amenity will likely see renewed interest as inner city buyers look to these more affordable alternatives.”

See over page for the city by city breakdown.