Higher mortgage rates and near‑record national prices are pushing many first‑home buyers and property investors to the sidelines, but new data show there is still room to move.
PropTrack has identified 402 suburbs where buyers can still secure a house or unit with a median price below $500,000, even as rising interest costs erode borrowing capacity.
Nationally, the median house price now sits at $996,000 and the median unit at $730,000, pushing many buyers towards smaller properties, new locations, or both. For brokers, these pockets of affordability offer critical options for clients whose plans have been squeezed by successive rate rises.
This is especially true as rising interest rates rapidly erode borrowing capacity, with the Reserve Bank’s second consecutive 0.25 percentage point hike taking the cash rate to 4.1%. Canstar estimates an average single borrower has lost about $25,000 in capacity across the February and March moves, or around $49,000 for a couple on two average incomes.
In Melbourne, softer price growth in recent years has left more sub‑$500,000-unit options within reach of the CBD, including well‑located inner and middle‑ring suburbs with strong transport links and amenities. Suburbs such as Kensington, Fairfield and Footscray offer units around the $450,000–$500,000 mark, while buyers willing to head further out can look to Box Hill, Sunshine, and Broadmeadows.
Similar stories are playing out in parts of Greater Sydney and major regional centres, where apartments in selected suburbs can still be found around the mid‑$400,000s to high‑$400,000s. In New South Wales, units in western Sydney pockets like Mount Druitt and Fairfield, and apartments in regional hubs such as Wagga Wagga, Bathurst, and Nowra, remain under the $500,000 threshold.
Across Queensland, despite Brisbane now sitting among the nation’s priciest markets, there are still dozens of suburbs under the $500,000 mark, particularly in lifestyle‑driven coastal and island locations.
On Russell Island, for example, agents report strong demand from interstate buyers trading million‑dollar city homes for cheaper properties. As one local agent put it, “They’re living here mortgage-free,” highlighting a growing cohort of cash‑rich movers seeking lower costs and a change of pace.
Beyond the east coast capitals, regional towns in South Australia and Tasmania continue to attract owner‑occupiers and property investors looking for rental yield and long‑term growth potential at lower price points. South Australian centres such as Millicent and Port Pirie still offer freestanding homes well under $500,000, while Tasmanian towns like Queenstown and Strahan provide comparatively low entry prices for both owner‑occupiers and investors.
In parts of Tasmania’s west coast, agents say affordability is a key drawcard for mainland buyers, with one noting, “People come to these areas because they’re locked out elsewhere.” Further afield, value can also be found in Western Australian regional hubs like Geraldton and Cable Beach in Broome for units, and in mining towns such as Kambalda and Kalgoorlie for houses.
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