Houses in Newtown have been deemed “undervalued” in new property research, with homes priced an average $293,000 below neighbouring suburbs offering similar housing and amenities.
The research from property analytics group SuburbData showed the suburb’s median price is sitting noticeably below what its supply-and-demand fundamentals suggest it should be worth.
This did not mean Newtown was considered “cheap”. The research defined an undervalued suburb as one where homes trade at a discount to comparable nearby areas.
SuburbData noted discounts like this often followed a period of weak or subdued growth, with a later pick up in buyer demand and reduction in available stock. That recent change in the supply and demand dynmic suggested prices may soon recover.
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![Newtown home sellers](data:image/svg+xml,%3Csvg xmlns="http://www.w3.org/2000/svg" viewBox="0 0 1280 720"%3E%3C/svg%3E)
Newtown homeowners Ben and Kirsty Winning have been in their Newtown home six years and will sell at auction this weekend. Picture: Rohan Kelly
Key signs of Newtown being “undervalued” were lower prices than similar neighbouring suburbs, a smaller gap between house and unit prices, signalling better value for house buyers, and lagging price growth compared with surrounding areas.
SuburbData’s analysis assumed markets move towards equilibrium: when buyer demand outweighs supply, prices tend to rise until the gap closes.
SuburbData analyst Jeremy Sheppard said opportunities for growth were still out there, even in a weaker market.
“There are still plenty of areas around Australia where you are better off parking your money in a property than letting it sit in a bank,” he said.
“These areas have simply become harder to find. During boom times, like in 2021, markets like that were easy to find. You throw a dart on a board and hit one. Now you need to know where to look.”
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Newtown remains one of Sydney’s most popular areas.
The research also warned buyers to be wary of overvalued suburbs, where years of aggressive growth have pushed prices beyond what current supply and demand can sustain.
Newtown residents Ben and Kirsty Winning said they were not surprised to learn their suburb had been classified as “undervalued” given a range of recent improvements.
They pointed to some upgrades on Enmore Rd that had brought an influx of new bars, restaurants and boutique stores.
“We love the area,” Mr Winning said, noting that were in the process of trading up from a house on Phillip St to a nearby property.
52 Phillip St, Newtown goes to auction on Saturday with real estate group Adrian William.
Their current house on Phillip St will go to auction this weekend with agent Paul Koulizakis of Adrian William.
Adrian William director Adrian Tsavalas said home buyers in Newtown could get “better value” than 12 months ago due to the recent market downturn.
He said upgraders were in a particularly good position in the current market and there were good deals.