Bargain homes list: cheapest Sydney suburbs 10km from CBD
It's come as agents warn $3 million has already become the norm for most houses in areas within Sydney's inner ring, with prices above $1 million largely the norm for most inner apartments.
Research from Ray White Economics showed the cheapest inner suburbs were currently a strip of suburbs under the flight path of Sydney Airport, including Tempe, Sydenham and St Peters.
Houses in these suburbs had a median price of about $1.7 million but, being smaller areas, rarely had properties available for sale. And the prices are going up.
The next cheapest suburb within 10km from the city by median house price was Mascot, where houses commanded prices of about $1.95 million.
Thereafter, Marrickville had the next cheapest houses, with typical prices of about $2.1 million.
Ray White Economics data analyst Atom Go Tian said expensive prices in inner suburbs were affecting the entire market as it meant even families on decent incomes were being pushed out.
'We're very close to, or may have already reached the point, where sub-$2 million houses disappear entirely from 'easy reach' of the CBD,' he said.
'As each distance band fills up with expensive housing, buyers are pushed further out, creating a ripple effect that inflates prices in previously affordable areas.'
Even the cheapest detached housing in much of the area within 10km of the CBD was out of reach for families on fairly decent incomes, Mr Go Tian added.
'The implication is that even with dual professional incomes, many households are effectively locked out of inner Sydney,' he said.
'(That's) unless they have substantial family wealth or equity from previous property ownership.
'This effectively creates a two-tier system where property ownership in inner Sydney becomes increasingly dependent on intergenerational wealth transfer rather than earned income alone.'
With limited options to buy houses within a 10km radius of CBD, PropTrack data indicated buyer competition has been ramping up – especially since interest rates were cut earlier this year.
PropTrack reported an average of over 100 'key' buyers per listing for houses in Rosebery, in the inner south, and in coastal suburbs Coogee, Clovelly and Rose Bay.
Key buyers were those who had inquired about listings with agents by phone, text, email or submitted an online request for an inspection.
Adrian Tsavalas, the director of inner west agency Adrian William, said there were simply not enough houses within inner suburbs for the numbers of buyers who wanted them.
'It's just pure supply and demand and that's why the prices keep going up,' he said.
'It won't be long until there are no longer any opportunities to buy under $3 million close to the (CBD). We've already seen that happen with $1 million and then $1.5 million. It's inevitable.'
Data showed prices in Sydney's middle ring suburbs – between 10km and 20km of the CBD – were generally cheaper than those closer to the CBD but remained a big ask for house buyers on regular incomes.
House prices across most of this region were also above $2 million, with a cluster of suburbs that roughly followed the Bankstown train line in the southwest offering the most affordable options.
This grouping included neighbouring suburbs Wiley Park and Lakemba (the only two middle-ring suburbs with a median house price below $1.4 million) and Greenacre, with a median of $1.45 million.
Once house seekers went between 20km and 35km outside of the CBD, some of the cheapest options included southwest suburb Fairfield (median $1.12 million) and nearby Canley Vale ($1.22 million).
'Areas like Fairfield East, Granville-Clyde, and Auburn have industrial heritage that has historically kept residential prices lower,' Mr Go Tian said.
'The data shows cheaper areas are typically those with longer commute times or poorer transport connections, suggesting infrastructure hasn't kept pace with housing demand.'
Marrickville resident Monica Wulff said she wasn't surprised to learn her area offered home buyers some of the best bang for their buck closer to the city.
'The houses are a lot bigger than in the surrounding areas and you get this access to culture while still being convenient and quiet enough to raise children,' she said.
'Our house has a big garage, new kitchen, space to breathe and a bit of a backyard and we didn't find you could get that kind of value even in places a little further out like Leichhardt.'
The couple are now selling their Philpott St house at auction August 2 to be closer to family. Ms Wulff said cheaper prices in outer suburbs were not really an option for them.
'We need to be close to the city. It needs to be accessible. We got that in Marrickville but it's not easy to find that (in Sydney).'
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