Australian suburbs near the beach and the city where you can still buy a house on an average salary

Australians on average salaries can still buy a nice house near the beach or the city without being in mortgage stress – despite a surge in property prices.

Sydney’s median house price of $1.4million is well beyond the reach of any borrower with a 20 per cent mortgage deposit unless they earn $187,000, to be among the top 3.5 per cent of income earners.

But beyond Sydney, the Central Coast, the Gold Coast and the Sunshine Coast, it’s still possible to buy a house near the beach or the city in Brisbane, Melbourne, the NSW Mid-North Coast, Cairns, Hobart or Adelaide without being in mortgage stress.

The Australian Prudential Regulation Authority, the banking regulator, is concerned when a borrower has a debt to income-ratio of six or more.

Using CoreLogic data for March, Daily Mail Australia has found suburbs where an average, full-time worker earning $90,917 a year, with a mortgage deposit, can have a manageable mortgage even as interest rates rise.

Those able to work from home can be an owner-occupier in a house instead of renting or having to buy a cramped unit to live in that would be unlikely to go up much in value.

Potential buyers more concerned about capital growth, who want to continue living in Sydney, can also consider buying a house to rent out as an investor.

Brisbane has been Australia’s top-performing capital city market with median house prices soaring by 32.1 per cent in the year to March to hit $856,731.

But it’s still possible to buy a house in the Queensland capital for much less and be a reasonable commuting distance from the city centre. 

Wacol, just 20km south of Brisbane, has a median house price of $447,043.

With a 20 per cent deposit, someone with a $381,634 loan would have a debt-to-income ratio of 4.2.

Caboolture in Brisbane’s north, near Bribie Island, has a median house price of $577,934, which means someone paying off $462,347 would have a debt-to-income ratio of five.

Melbourne also has pockets of affordability despite having a median house price of $999,037.

Buyers willing to head 45km north-west of the city can buy a house at Melton, where the mid-point house price is $493,293.

Buyers willing to head 45km north-west of central Melbourne can buy a house at Melton, where the mid-point house price is $493,293 (pictured is a house priced from $480,000 to $520,000)

A borrower paying off $394,634 would have a debt-to-income ratio of 4.3.

Hobart is still accessible despite its median house price surging by 21.9 per cent during the past year to $791,587. 

But just 9km north of the city on the River Derwent, Glenorchy has a median house price of $613,879, which yields a debt-to-income ratio of 5.4 for someone paying off $491,103. 

Adelaide is still affordable, despite house prices surging by 28.7 per cent during the past year to $658,446. 

But at Kilburn, just 9km north of the city, houses typically cost $600,605 which means someone paying of $480,484 has a debt-to-income ratio of 5.3.

The New South Wales Mid-North Coast has been one of Australia’s hottest property markets with Port Macquarie and Coffs Harbour both experiencing 30 per cent growth rates during the past year.

This has put them beyond the reach of average-income earners, with respective median house prices of $933,917 and $795,195.

But in between, it’s still possible to buy a house within walking distance of the beach with Nambucca Heads having a mid-point price of $643,105, following a 32 per cent annual surge.

Adelaide is still affordable. At Kilburn, just 9km north of the city, houses typically cost $600,605

Despite a 32 per cent price surge during the past year, Nambucca Heads is still an affordable pocket of the NSW Mid-North Coast with a median house price of $643,105 (pictured is a home on the market for $635,000)

Someone with a deposit paying off $514,484 would have a debt-to-income ratio of 5.7.

For those after a tropical change, restored Queenslander houses near central Cairns are still affordable with Parramatta Park having a typical house price of $512,446, which minus the 20 per cent deposit for a $409,957 loan means a debt-to-income ratio of 4.5.

After the election is over on May 21, borrowers need to be mindful about the Reserve Bank of Australia raising the cash rate in June from a record-low of 0.1 per cent.

Westpac, NAB and ANZ are expecting the cash rate to hit 2 per cent by mid-2023. 

A typical borrower paying off close to $600,000 would see their monthly mortgage repayments climb by more than $600 should the Commonwealth Bank increase its variable rate from 2.29 per cent to 4.19 per cent in line with RBA moves.

For those after a tropical change, restored Queenslander houses near central Cairns are still affordable with Parramatta Park having a house price of $512,446, which minus the 20 per cent deposit for a $409,957 loan means a debt-to-income ratio of 4.5 (pictured is a house available for $545,000)