John McGrath, founder and chief executive of the real estate group that carries his name, has released the McGrath Report 2027, naming 40 suburbs across New South Wales, Victoria, Queensland and Tasmania that he expects to grow over the coming year, according to Real Estate. The list, published on Sunday, mixes metropolitan and regional locations. McGrath also used the report to argue that the sharpest phase of the current housing downturn may be nearly over.
Why it matters
McGrath's forecast lands in the middle of a steep and unusually quick decline in home values. He described this as the eighth correction he has seen in more than four decades in the industry, and said it feels like the fastest drop in values he can recall. While the data companies are reporting single-digit declines, McGrath said most large metropolitan markets are actually down 10 to 15 per cent over the past six months, with some falling as much as 20 per cent.
His conclusion is that history points to the big cities being close to the bottom. If that holds, the suburbs on his list are where he expects buyers to find the earliest recovery — and the report is effectively a set of bets on where demand will return first.
The picks, state by state
In Sydney, McGrath pointed to Campsie, describing it as a possible successor to Marrickville, which he had previously promoted as "the new Paddington." He said buyers who followed that earlier call would have multiplied their money more than once, and cited Campsie's cultural diversity as a reason to watch it now.
On the south coast of New South Wales, he highlighted Narooma, praising its beaches, national parks and cafes, and noting that Justin Hemmes' Merivale Group has recently opened a 1970s-inspired motel called The Whale. With a median house price of $990,000, he argued it represents good value next to other coastal towns.
In Victoria, McGrath named Sunshine, where buyers can choose from terraces, 1920s Californian bungalows, contemporary apartments and architect-designed houses. He said the suburb's multicultural character shows in its restaurants and festivals, and suggested its time as an overlooked part of Melbourne may be ending given its access to the city and existing amenities.
He also selected Mildura on the Murray River, calling it one of Victoria's strongest regional growth centres. He attributed that to an economy spread across agriculture, healthcare, construction and manufacturing, and said the town draws first home buyers, people relocating from cities and Melbourne retirees. According to the report, Mildura's population is projected to exceed 66,000 by 2046, up from 56,792 in 2021, with employment forecast to rise 26.5 per cent between 2026 and 2046.
In Queensland, Beenleigh was chosen for its position in the corridor between Brisbane and the Gold Coast, where buyers are looking for cheaper options as nearby markets become harder to afford. McGrath cited rail and motorway links and investment in nearby employment areas as supports for the suburb.
Maryborough, near the Fraser Coast, was picked for buyers who want more space and value while staying connected. He pointed to its heritage streetscapes, established schools and community ties, along with investment aimed at improving liveability and opening up new housing, and said its lower prices and broadening local economy give it long-term potential as coastal markets grow more expensive.
In Tasmania, McGrath named Chigwell, about 15 minutes north of Hobart off the Brooker Highway, which he said has long sat in the shadow of pricier parts of Glenorchy. He noted its access to Glenorchy's shopping area, median house values just above $600,000 and a rental yield of 5.3 per cent.
He also chose Mayfield in Launceston, where median house prices sit below $530,000 and the CBD, the University of Tasmania's Newnham campus, the Australian Maritime College and the Mowbray shopping precinct are all within easy reach. Even after values rose 27.9 per cent last year, he said yields remain around 5.6 per cent, making it attractive to first home buyers and investors.
A broader argument about policy
The report's release coincides with McGrath's public criticism of the federal government's property policies, which News.com.au covered under the headline "Killing property: McGrath slams Albo." The 40-suburb list is the centrepiece of the report, but it sits within a wider argument from McGrath that policy settings are weighing on the market at the same time as values fall.
Real Estate reports that the report also examines the national market more broadly, alongside separate breakdowns of Queensland and Sydney suburbs. The Australian has also covered the national picture.
What to watch next is whether the data companies' figures catch up with the deeper declines McGrath says are visible on the ground, and whether the suburbs he has named begin to outperform as the correction runs its course.
