The Illawarra has featured among a national listof the top 100 suburbs for value growth over the past 25 years.
CoreLogic has identified the best performing suburbs for price growth over the past 25 years, based on change in median prices between 1993 and 2018.
The joint study by Aussie Home Loans and CoreLogic has also revealed the top 20 suburbs in the Illawarra region for value growth over this period.
The Illawarra list incorporates median house prices for suburbs from the Wollongong, Shellharbour, Kiama, Shoalhaven and Wingecarribee local government areas.
The ‘25 Years of Housing Trends’ report found that Callala Bay in the Shoalhaven topped the Illawarra list, having experienced substantial growth in its median house price from $43,000 to $589,500 over the past 25 years, an annual change of 11 per cent.
This is well above Sydney’s average of 7.6 per cent.
Houses in Flinders took second position, with its median house price increasing from $60,000 to $755,000, or 10.7 per cent annually.
Callala Bay and Flinders also made the national top 100 suburbs for value growth, in positions four and nine respectively.
Rising median prices in Blackbutt, Albion Park, Coledale, Tarrawanna, Thirroul, Jamberoo, Bulli, Stanwell Park, Gerringong and Austinmer ensured those suburbs also made the Illawarra’s top 20 list.
Blackbutt also ranked as No.28 on the national top 100 list.
Blackbutt’s median price for 2018 is $741,000; in 1993 it was $64,000.
This represents a 10.3 per cent average annual change in median price over the 25 years.
“Our report clearly shows that housing continues to grow as Australia’s largest asset class, with many home owners living across the Illawarra achieving really strong value growth over the last 25 years,” chief executive officer of Aussie James Symond said.
The average owner occupier loan size in NSW has increased approximately in line with property values, with the typical loan size now $445,500, or 6.4 per cent per annum higher since 1993.
“With average mortgage rates currently close to their record low levels of the 1960’s, loan serviceability levels have improved but housing affordability remains a major challenge,” Mr Symond said.
“Household incomes haven’t kept pace with rising property prices. This is demonstrated by NSW’s shrinking first home buyer numbers from 18.5 per cent in 1993 to 14.2 per cent in 2018, while investors have taken a far bigger slice of the pie, up from 18.8 per cent to 50.2 per cent over the same period.”
According to the report, over the past 25 years the median house value nationally has risen by 412 per cent, or $459,900.
The report notes that if home values increase at the same annual rate as they have over the past 25 years there will be a median dwelling value nationally of $2.9 million by the year 2043.
“While that value looks astronomically high in today’s money, if the historic averages play out over the next 25 years, Sydney values would be breaking the $6.3 million mark and Melbourne would be over $5.8 million,” the report said.
“One thing that is certain is that housing markets will continue to move through their cycles, with periods of growth, decline and steady values conditions.
“History has shown that over time these cycles tend to smooth out the year to year volatility in growth rates.”
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