The best places to buy a home in regional Australia on a budget

The best places to buy a house in regional Australia for house hunters on a budget have been revealed.

New research by Canstar and Hotspotting has highlighted the top towns to purchase a home for buyers with a deposit of just $50,000.

The top choices range from pockets of bustling regional cities, such as Long Gully in Bendigo and Lavington in Albury, to coastal hubs such as Cairns and Townsville in Queensland.

The top budget-friendly spots were selected based on affordability, median price growth, house rent increases and vacancy rates, as well as access to infrastructure, such as schools and transport.

Terry Ryder from property market trend and insights service Hotspotting said there are still plenty of opportunities for home buyers on a budget to enter the property market.

While many buyers on a budget are increasingly opting for units and townhouses in capital cities, he said regional areas are full of opportunities for people with a dream of owning a house with a backyard.

“Enabled by technology and the ability to work remotely, there are many regional areas that have become a strong force in real estate,” Mr Ryde said.

Lifestyle appeal

He adds that regional areas are becoming increasingly popular not just due to affordability but for lifestyle reasons.

“There are many people who are moving to regional areas to escape the congestion and noise and expense of city life,” he said.

Mr Ryder said the ‘Deposit Stars’ report, which also lists inland cities such as Seymour in Victoria, Oxley Vale in Tamworth and Toowoomba in Queensland, provides valuable insights for both owner-occupiers and investors on a budget.

He said the key is finding regional areas with strong economics and prospects for growth, as well as affordability.

“Generally speaking, regional Australia has been outperforming capital cities on capital growth for the last five or six years, but investors need to choose regional locations well,” Mr Ryder said.

“Regional cities with strong economies and lots of infrastructure spending happening can be very good performers for investors as well as proving to be affordable options,” he said.

NSW hot spots

In New South Wales, the report lists Mount Austin in Wagga Wagga, Oxley Vale in Tamworth, Lavington in Albury, Muswellbrook, in the Upper Hunter region and the inland town of Narrabri as top spots to buy for house hunters with a deposit of $50,000.

The most affordable is Mount Austin, with a median house price of $415,000, after experiencing annual price growth of 10 per cent.

This is followed by Narrabri ($440,000), Lavington ($489,000) Oxley Vale ($494,000) and Muswellbrook, which has seen capital growth of 7 per cent over the past year and has a median house price of $500,000.

Bargains in Victoria

With prices for regional Victoria overall falling slightly over the past 12 months, some of the state’s largest regional cities, including those less than a two-hour commute to Melbourne were found to have a good supply of houses with prices below $500,000.

These include Long Gully in Bendigo ($445,000), Redan in Ballarat ($460,000) and Seymour ($480,000).

Two hours north of Melbourne, Shepparton, with a median house price of $455,000 is listed as a top choice; along with Mildura, further north, which has a median house price of $437,000.

Queensland offerings

Meanwhile, Rockhampton in central Queensland, which had capital growth of 15 per cent over the past year, was named as the most affordable option for buyers in Queensland looking for a house rather than a townhouse or unit, with a median house price of $222,500.

For buyers considering a unit or apartment, the tourist hub of Cairns is flagged as a great option for buyers with a deposit as little as $50,000. Cairns units have a median price of $228,000 and have experienced 19 per cent growth over the past year.

For buyers looking for a house, the report lists Bundaberg on the Coral Coast and Townsville, on the northeast coast, as top budget choices. In Bundaberg, the median house price has risen 20 per cent in a year to $420,000. Townsville has experienced annual capital growth of 22 per cent, with median house prices sitting at $410,560.

The inland city of Toowoomba, Australia’s largest inland city after Canberra is also tipped as a top spot to buy following median house price growth of 12 per cent over the past year. With the arrival of the Inland Rail Link, the city is expected to experience even more growth.

Regional dreaming

The ‘Deposit Stars’ report coincides with the publication of the Regional Australia Institute’s ‘Good Life Guide’ which compares the liveability and affordability of Local Government Areas (LGAs) across Australia.

The new analysis found that the great Aussie dream of buying a house remains well and truly alive, with data showing the regions can offer both affordability and competitive incomes.

The guide considers an area’s median income and median house price, the income to house ratio, how economically diverse the region is, and its distance from the coast and national parks.

“The Good Life Guide highlights that many people can earn a comfortable living outside of Australia’s biggest cities, as well as get on a realistic path to home-ownership,” said Regional Australia Institute CEO Liz Ritchie.

“In many regional communities you can earn a similar if not larger income than in a metropolitan area and find more affordable housing,” she said.

The guide, for example, found that the City of Canterbury-Bankstown in Sydney, where the median home price is $981,000 and the median income is just over $56,000, has an income to house ratio of 17.4. This compares to Tamworth, where the median income is around $60,000 and the median home price is $500,000, with a price-to-income ratio of just 8.3.

“That’s a big difference,” Ms Ritchie said.

Similarly, it found that in the outer suburb of Monash, the income to house ratio is 20.1 compared to a ratio of 8.1 in Shepparton, just over 200 kilometres away.

Ms Ritchie said with cost-of-living concerns ongoing for many people, the guide not only provides important insights into key financial metrics in both metropolitan and regional areas, but also enables users to explore what a “good life” could look like in other parts of the country.

The guide also highlights dozens of areas across regional Australia, where the median home price is $500,000 or less, including Mildura and Shepparton in Victoria, Tamworth in New South Wales and Mackay in Queensland.

Best buys

This neat and renovated three-bedroom house in Long Gully in Victoria comes in at a price guide of $390,000-$420,00.

This well located home with large garden in the Wagga Wagga suburb of Mount Austin comes in with a $480,000 price tag.