Buyers in Sydney and Melbourne are increasingly turning to second-tier suburbs as a strategy to find more affordable housing options and larger properties while remaining close to city amenities. Rising prices in premium, blue-chip suburbs have prompted many to explore adjacent or less prestigious areas that still offer convenient access to schools, public transport, and community facilities.

In Sydney, real estate professionals report a noticeable trend of buyers relocating from well-established suburbs to their neighboring counterparts. Jackson Cox, director and auctioneer at Richard Mathews Real Estate Strathfield, notes that affordability remains the primary driver behind these shifts. “For many homeowners, upsizing within their local area while managing budget constraints is becoming a key consideration,” Cox said. He points to examples such as moves from Croydon to Croydon Park, Burwood to Enfield, and Ashfield to Ashbury, where buyers gain additional space—often an extra bedroom or transitioning from townhouses to semi-detached homes—without significantly increasing their commute times or disconnecting from their existing social networks.

Several inner-west suburbs, including Dulwich Hill, Earlwood, Marrickville, Campsie, and Ashfield, have gained traction and are sometimes even surpassing more traditionally sought-after locations in popularity. Marrickville, in particular, is cited as a suburb that has undergone significant transformation, evolving from a lesser-known area into a target for families and homeowners drawn to its community atmosphere and housing variety. Cox also highlights a demographic shift within these suburbs, driven predominantly by owner-occupiers on a budget edge, contrasting with investors who often favor more affluent blue-chip suburbs. The rise in duplex developments in inner-west areas reflects changes in both market demand and housing styles.

In Melbourne, the dynamic mirrors Sydney’s with buyers opting for suburbs such as Preston, Coburg, Pascoe Vale, Maidstone, West Footscray, Bentleigh East, Murrumbeena, Heidelberg West, and Yarraville over traditional premium suburbs like Toorak, Brighton, Hawthorn, and Camberwell. Cate Bakos, a buyer’s advocate and property adviser, observes that many purchasers are not only settling for but prioritizing these second-tier locations due to their combination of value, character housing, and family-friendly amenities. The availability of schools, shops, and public transport, particularly rail links, enhances the appeal of these suburbs. Most have good public transport connections, with Maidstone noted as an exception.

Bakos points to the architectural charm found in many of these areas, including Californian bungalows and homes dating from the early to mid-20th century, often situated on relatively large blocks. Some suburbs, like West Footscray, Maidstone, Reservoir, Preston, and Coburg, have experienced significant capital growth over the last two decades, aided by gentrification and infrastructure improvements such as the Metro Tunnel and rail crossing removals. These upgrades have alleviated traffic congestion and improved commute options, further boosting the suburbs’ attractiveness.

Families, first-home buyers, and those seeking to upsize are the primary cohorts driving demand in these second-tier areas. While prices remain below those of the top-tier suburbs, they have nonetheless risen above median levels, reflecting growing interest and competition. The migration toward these suburbs reflects broader shifts in the housing market as buyers balance cost, lifestyle, and space requirements amid escalating home prices.