House prices in every Australian capital city have at least tripled in value over the last 20-years, and even bigger growth has occurred in numerous regional locations.
In 2002, less than $200,000 would have been sufficient to purchase a detached house at the median value in 5 out of 8 capital cities. Those same properties today are worth more than 3-times that.
Over the last 20-years, the median house value increased 3.7 times in both Sydney (from $364,000 to $1.35 million) and Melbourne (from $248,000 to $920,000).
‘Oh, if only I found a way to make it happen. What could have been.’
So called ‘blue-chip’ municipalities like Sydney’s Inner-west ($515,000 to $2.04 million) and Melbourne’s Hobson Bay ($260,000 to $1.05 million) saw house prices increase 4.0 times. But they were nowhere near Australia’s best.
It would have cost $180,000 to buy a basic house in a middle-ring Brisbane suburb in 2002. Over the subsequent 20-years, it increased 4.2 times to now be worth $755,000. Wowee.
The biggest increase among the 8 capital cities over the last 20-years was experienced in Hobart (6.3 times), where the cost of a standard house increased from just $120,000 in 2002 to today’s $750,000.
How do you like them apples?
House prices tripled or more over the last 20-years in 136 individual regional municipalities (this excludes locations with populations of less than 12,000).
The biggest increase in regional house values was in the municipality of Huon Valley. Situated at the southern end of Tasmania and with a current population of 18,800 people, the median value increased 7.6 times (from $87,000 to $660,000).
Tasmania dominated Australia’s top tier for capital growth over the last 2-decades.
The historic port cities of Burnie (6.8 times) and Devonport (5.5) were in the nation’s top echelon.
Ditto Launceston. House prices increased 6.3 times in this major regional city at the epicentre of the highest quality food bowl in the world, with stunning architecture and outstanding food and booze experiences.
Most people would not be surprised to learn that Byron (6.4 times) produced one of Australia’s highest growth rates.
Throughout the NSW Norther Rivers – Coffs Harbour, Tweed, Ballina, Lismore and Nambucca – house prices increased 5-fold over the last 20-years.
Similar growth was experienced in the NSW Hunter Valley locations of Cessnock (both 5.3) and Maitland (4.9).
The rates of growth always varies wildly from city to city and from year to year, primarily due to the varying economic conditions in each location, different housing supply volumes and varying levels of housing affordability.
But widespread tripling of real estate values (or more) over the last 20-years is an incredibly valuable reminder to people that the only gain in real estate from sitting on the side lines is splinters on one’s rump.
While a growing number of people these days seem to easily become paralysed by negative commentary, they would be wise to note that the last 2-decades included a Global Financial Crisis, 8 prime ministers, a national credit crunch and the COVID health pandemic. Yet house prices tripled.
Generally speaking, bigger rates of capital growth occurred during the first of these 2-decades, even though the standard variable home loan rate was significantly higher (between 6 and 9.5 percent) than in the most recent decade.
Victoria’s biggest real estate growth locations over the last 20-years include Golden Plains (6.3 times), Mornington Peninsula (5.4) and the luxurious Surf Coast (4.7).
‘If only I bought back then,’ one might be saying.
Just 1.5 hours east of Melbourne, one could have paid just $105,000 in 2002 for a standard house in Leongatha (South Gippsland municipality). The value over the subsequent 20-years increased 5.5 times to now be worth $580,000.
The performance of the property market in this very productive dairy region with fantastic cottage tourism experiences is one of countless examples to prove that ‘low profile’ is not at all related to rates of real estate capital growth. Australia has bucket loads of locations like this.
Whilst house prices in luxury locations like Perth’s Peppermint Grove (2022 median house value $3.65 million), Sydney’s Mosman ($5.25 million) and Adelaide’s Holdfast Bay ($1 million) have tripled over the last 20-years, their rates of growth are only half what occurred in a plethora of lower profile parts of Australia.
All up, there are 80 individual regions of substance where the municipality’s median house price over the last 20-years increased by more than the 3.7 times produced in Sydney and Melbourne.
Queensland’s highest growth was in idyllic Noosa (5.7 times), followed by neighbouring regions Gympie (4.7) and Sunshine Coast (4.6).
One might be kicking themselves if they realised that, 20-years ago, they could have paid just $119,000 for a standard house in Fraser Coast and it’s now worth 4.3 times that ($510,000).
Scenic Rim (4.2), Gold Coast and Bundaberg (both 3.8 times) were also strong sunshine state performers.
Some other locations where property prices have tripled in what Propertyology affectionately refers to as ‘mini capital cities’ are Albany, Albury, Armidale, Ballarat, Bendigo, Busselton, Cairns, Dubbo, Geelong, Geraldton, Mackay, Mount Barker, Newcastle, Orange, Shepparton, Tamworth, Toowoomba, Townsville, Wagga Wagga and Wollongong.
Great rates of growth are not unique to the 20-year era mentioned in this report.
Australian house prices more than tripled in the 1970s and again in the 1980s – amid double-digit home loan rates and spiralling inflation.
Also, during the 17-years of 1974 and 1991, Australia experienced three (3) recessions, yet house values increased 5-fold. This is another great piece of evidence to throw back in the face of lemon suckers when they get on their doomsday soapbox.
Reflecting on the historical growth of real estate prices is a good reminder of the value of compounding growth over the median term.
Twenty years ago, as with today, a segment of society sat around complaining (and blaming) about how difficult it was to purchase real estate.
Meanwhile, those who did not attend the pitty party focused on controlling the controllables and eventually purchased real estate.
There will be plenty of glass-half-empty personalities reading the facts in this report who can’t contain themselves from responding with ‘…but this…’ or a ‘…it’s different now because…’, ‘…blah blah blah…’
Make no mistake, those who snooze always lose.
Now and always, focus on improving your future, not the white noise [here’s how].
No one can control their future. Everyone can control their habits. Good habits create good futures.
Imagine how you’d feel if, within the next few months, you purchased a property for (say) $600,000 and it went on to triple in value over the next 20-years.
Ponder how different your life will be then, with an asset worth $1.8 million compared to without it.
But don’t just buy anywhere.
Knowing the right time to enter the property market of an individual location is important, because it has a significant impact on one’s ability to reinvest, expand their portfolio and when to exit a market.
This is where skilful property market research, analysis and Propertyology’s buyer’s agents is invaluable [check out this example].
Propertyology are national buyer’s agents and Australia’s premier property market analyst. Every capital city and every non-capital city, Propertyology analyse fundamentals in every market, every day. We use this valuable research to help everyday Aussies to invest in strategically-chosen locations (literally) all over Australia. Like to know more? Contact us here.
