Are you in a growth suburb?

Property buyers after a safe bet should be looking near the water, with bayside suburbs in both Melbourne and Sydney topping a national ranking of suburbs based on four key growth drivers.

Annual growth rate, median number of days on market, supply and demand and price difference compared to surrounding suburbs were all weighted together to calculate the overall ranking, which shows suburbs where houses are likely to rise in value.

Where does your suburb rank?

REA Group Chief Economist Nerida Conisbee says she is not surprised to see beachside suburbs like Narrabeen in north Sydney and St Kilda West in inner Melbourne topping the national list.

The suburbs ranked in the top 10 are not exclusively high end, although harbourside enclaves Rose Bay and Darlinghurst do make the list at number two and five respectively.

Conisbee says high end suburbs are always a good buy if you are looking for capital growth, but investors should be wary of suburbs that have experienced sudden growth due to an increase in new development.

Dakabin, north of Brisbane, with an annual growth rate of 15.3%, and Mernda, in outer Melbourne, with an annual growth rate of 8.3%, were the cheapest suburbs to make the list with median house prices both below $500,000.

The median number of days on market in both suburbs was also higher than any other suburb on the list – 71 in Dakabin and 43 in Mernda.

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