The BEST suburbs to buy for under $500,000

Here are 10 suburbs where Aussies can buy a home for under $500,000. (Source: Getty)

For Australians looking to enter the housing market, there is still opportunity to find an affordable, but still desirable, property.

The top 10 suburbs to buy a home have a median sales price between $460,000 and $500,000, with weekly incomes ranging from $1,152 to $1,813.

HOOD.ai founder and CEO Tommy Fraser said housing affordability was a hot-button political issue getting a lot of attention in the federal election campaign.

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“It’s no wonder both sides of politics are talking about affordability, because the housing market is a tough place right now for people on average salaries,” Fraser said.

“Buyers have to deal with the fact prices have dramatically increased throughout Australia over the past 18 months.”

Unsurprisingly, not a single suburb in New South Wales made the list, but Victoria dominated with seven of the top 10 spots.

Suburbs were excluded if they were more than 100 kilometres from a capital city or if they had a socio-economic SEIFA score of less than 5.

Here are the top 10 suburbs to buy for under $500,000 and the median home sale price.

1. Tyabb, VIC - $$460,000

2. Manifold Heights, VIC - $462,500

3. Sydenham, VIC - $$470,000

4. Truganina, VIC - $471,000

5. Maslin Beach, SA - $475,000

6. Pacific Pines, QLD - $477,000

7. Sunbury , VIC - $480,000

8. Cranbourne North, VIC - $485,000

9. Grovedale, VIC - $495,000

10. Surrey Downs, SA - $500,000

Rate rise to hit mortgages

This comes as mortgage holders brace for higher interest rates with the big banks expecting the Reserve Bank of Australia (RBA) will lift the cash rate as early as June this year.

Canstar analysis found if the cash rate reached 1 per cent this year and lenders passed on the RBA hike in full, the average variable rate would rise from 2.99 per cent to 3.89 per cent.

This would see monthly repayments for the national median home value of $805,621 rise by $322 per month to $3,036, costing borrowers almost an extra $4,000 per year and more than $116,000 in interest over the life of their loan.

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