Sydney's top 20 suburbs for growth rates: Terry Ryder

Sydney's top 20 suburbs for growth rates: Terry Ryder
Sydney's top 20 suburbs for growth rates: Terry Ryder

Sydney’s three years of price growth has dragged the city up the capital city rankings for long-term capital growth, but only as high as fourth. 

Six months ago, it ranked sixth among the eight capital cities and still lags behind Perth, Melbourne and Darwin. This is for average annual growth in house prices over the past 10 years, which we survey regularly for the Capital Growth Superstars report.

Fourteen of Sydney’s Top 20 suburbs have long-term growth rates below 8% per year - not nearly good enough to make the Top 20 lists for Melbourne, Perth or Darwin.

No suburb in the vast Sydney metropolitan area has a double-digit growth rate. The best is Pemulwuy (median price $720,000) in the city’s western suburbs, with a long-term growth rate of 9.5% per year. Most of the suburbs in the Top 20 have growth rates in the 7.0% to 8.0% range.

At first glance, it appears that the Top End suburbs dominate Sydney’s Top 20 list, as 19 of the Top 20 (all except Pemulwuy) have median prices above $1 million. But, in fact, these are mostly suburbs a tier below the top end. 

In Sydney, the 15 most expensive suburbs all have median house prices above $2 million. None of the 20 most expensive suburbs (all with median prices above $1.9 million) make the Sydney’s Top 20 list for long-term capital growth. Most of them have growth rates below 5% per year.

Sydney’s Top 20 is dominated by 15 suburbs in the $1 million to $1.5 million range, which is Sydney’s second tier market.

This is a change from other surveys in the past three years, which have strongly featured the cheaper end of the Sydney metropolitan market. The growth of the past 2-3 years has elevated some of the more expensive areas.

The outstanding precinct is the Ryde LGA on the lower North Shore, which has four suburbs in the city Top 20. Ryde is the only municipality with more than two suburbs in the Top 20. Its four top suburbs are Eastwood, Ryde, Denistone East and West Ryde, all with median prices in the $1.1 million to $1.3 million range.

The prestige end of the market, suburbs with median house prices above $2 million, continues to deliver poor capital growth rates. Indeed, three of the most expensive suburbs of Sydney are included in the Bottom 20 list of suburbs with the worst growth rates in the city.

Vaucluse (median $3.4 million), Palm Beach (median $2.6 million) and Clontarf (median $2.5 million) all have growth rates of 2.1% per year or less. Clontarf’s 1.3% grow rate means it would take 55 years for property to double in value (compared to eight years for Pemulwuy, which has Sydney’s best growth rate).

There are four other million-dollar suburbs on the Bottom 20 list.

The worst precinct in Sydney for capital growth is the Sutherland LGA in the south of the metropolitan area – it has four suburbs (Burraneer, Bundeena, Lilli Pilli and Illawong) on the Bottom 20 list, all with growth rates below 2% per year.

Sydney’s Top 10 for long-term capital growth is:-

1 Pemulwuy 9.5%

2 Waitara 9.2%

3 Homebush 8.7%

4 Burwood 8.6%

5 Bondi 8.0%

6 Darlington 8.0%

7 Hurstville 7.8%

8 North Willoughby 7.8%

9 Haberfield 7.6%

10 Hurlstone Park 7.6%

TERRY RYDER is the founder of hotspotting.com.au. You can email him or follow him on Twitter. 

Terry was recently joined by Property Observer editor at large Jonathan Chancellor for a webinar on why research is the key to successful property investing in 2015. You can download slides and audio from the webinar here.

Terry Ryder

Terry Ryder

Terry Ryder is the founder of hotspotting.com.au.

Tags: 
Sydney Price Growth

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