Home loan costs: How much do you need to buy Australia’s most affordable suburbs?

According to CoreLogic, property prices have risen by +8.3% in the last year – more than completely recovering their -7.5% fall in 2022. Now, between interest rate rises and prices, home loan affordability is top of mind for Aussie home buyers. 

But if we look at the numbers, how much money do you really need to buy in Australia’s cheapest suburbs?

Let’s break down the data from the CoreLogic Best of the Best 2023 report, based on property type and location. We’ll look at home loan deposit size requirements and what your monthly mortgage repayments could look like. 

Monthly repayments calculated using the current Mozo database average variable interest rate of 6.84% p.a. for an owner-occupied mortgage with LVR < 80% making P&I repayments over a 25-year term.

Home buyers looking for the most affordable houses must look beyond Australia’s capital cities – especially expensive markets like Sydney, Melbourne, and Canberra. 

CoreLogic’s latest data shows that the “Most Affordable” suburbs in the country by median price tend to be in Western Australia, the Northern Territory, and South Australia. 

Home loan costs for houses in Most Affordable Suburbs in Capital Cities (18 Dec 2023)

Home loan costs for houses in Most Affordable Suburbs in Regional Australia (18 Dec 2023)

Units are usually the most affordable option for first home buyers, downsizers, and investors in the Australian property market. They tend to offer the sweet spot between value and space. 

CoreLogic’s latest data shows that units are more affordable in the regions or capital cities like Brisbane, Adelaide, and Perth.

Home loan costs for units in Most Affordable Suburbs in Capital Cities (18 Dec 2023)

Home loan costs for units in Most Affordable Suburbs in Regional Australia (18 Dec 2023)

Homeownership is an important financial decision for many Australians. Finding cheaper properties for an investment or first home can ease the sometimes significant cost of entry while allowing you to get out of the rental market and build home equity.

However, it’s also important to remember that mortgages cost more than just a deposit and monthly repayment. You may also need to consider budgeting for charges like:

• Stamp duty.
• Lender fees, conveyancer fees, and solicitor fees, such as a property valuation. 
• Lenders Mortgage Insurance (LMI) if you buy with a small deposit.

See our guide for a full breakdown of home loan costs. 

There’s no guarantee the suburbs listed above will remain some of Australia’s most affordable places to buy in 2024, but it does serve as a timely reminder that not everywhere in Australia is outrageously priced. If you’re willing to look further afield, there are plenty of opportunities for every type of home buyer. 

Keeping your home loan costs down? Compare low interest rate home loans in the table below.