Buying property is a huge financial decision, yet one of the most valuable checks isn’t the price guide or the auction crowd – it’s who your future neighbours are.
New research suggests buying in an owner-occupier suburb rather than an investor-heavy one could deliver up to $148,000 more in capital gains over time.
Better still, buyers now have something they haven’t enjoyed for years: negotiating power.
Best suburbs to buy in
Here’s one of the most practical pieces of property research I’ve seen in a long time.
Cotality crunched 3,000 suburbs over 16 years (January 2010 to March 2026) and found units in owner-occupier-dominated suburbs increased in value by 99 per cent, compared with just 65 per cent in investor-heavy suburbs.
That 34 percentage point gap translates to an estimated $148,000 in additional capital gains on the 2010 median unit price of $436,000. For houses, the difference is smaller but still significant: 136 per cent growth versus 117 per cent, or roughly $83,000 in extra gains.
Why? Cotality economist Annabelle Mezieres says investor-heavy unit markets are more exposed to supply spikes and shifts in credit conditions. So when the market wobbles, there are more sellers and fewer committed owners to hold the line.
The budget’s negative gearing changes (grandfathered for existing properties from 1 July 2027) could shrink the buyer pool in investor-heavy areas even further.
The takeaway is simple: before you buy, especially a unit, check the suburb’s owner-occupier ratio. It could be worth six figures to you.
The buyer’s market is now six weeks old
If you’re hunting for a home, the auction numbers keep moving your way.
Cotality reports the combined capital city clearance rate has now held below 50 per cent for a sixth consecutive week, finishing at 46 per cent for the week ending 5 July.
To put that in perspective, the same week last year cleared 67.9 per cent – a whopping 21.9 percentage points higher.
What’s more, auction volumes are also down by almost a fifth.
Around the nation:
Brisbane is the standout soft spot, with just 23.5 per cent of auctions clearing – the weakest result since late April 2020. That means almost two in three homes were passed in.
Sydney managed 46.4 per cent, Melbourne 49.6 per cent and Adelaide 45.5 per cent, leaving Canberra (52.4 per cent) as the only capital city to clear more than half of its auctions.
Cotality expects auction numbers to continue easing over winter, with around 1,300 scheduled next week and 1,200 the week after.
When sellers consistently outnumber willing buyers, negotiating power firmly shifts towards buyers.
Location location
So if you’re in the market for a home, the stars are finally aligning for you.
Softer auction results sees those wanting to buy getting the upper hand. But while you’re looking at price guides, floor plans and school catchments, don’t overlook this important indicator of future growth:
The owner-occupier rate of the suburb you’re considering. It could make you an extra $148,000.
Good luck.
