The vast bulk of first homebuyers in Australia’s major capital cities continue to flock to the urban fringe in search of affordable house and land.

Research by national real estate chain, PRDnationwide, indicates the outer western suburbs of Melbourne and Sydney draw substantial numbers of those entering the property market for the first time. But suburbs on the fringe of the inner city such as South Yarra and Richmond in Melbourne and Arncliffe in Sydney are also drawing first homebuyers, who are attracted by their access to the central business district, shops, schools, transport and other long established community services.

PRDnationwide national research director Dr Asti Mardiasmo says the traditional house and land pairing is the dominant first-homebuyer property type in Victoria while in New South Wales there is a mix of house/land packages, units and townhouses because of the higher population numbers and housing density.

In New South Wales, Camden, Cobbitty, Spring Farm and The Oaks on Sydney’s southwestern urban fringe are the most popular with first homebuyers based on numbers compiled by that state’s revenue office. While in Melbourne, according to that state’s revenue office, Cranbourne, Botanic Ridge, Cannons Creek, Devon Meadows and Skye in the outer southeast top the popularity list. These suburbs are followed by Hoppers Crossing, Tarneit and Truganina in the west.

“First homebuyers are attracted by price, so they can enter the market,’’ Dr Mardiasmo says. “So they want value for money, and a stepping stone that allows them to buy more highly priced accommodation further down the track.’’

She says first-home purchasers in Sydney are choosing a mix of new and old areas in the outer southwest.

“Liverpool and surrounding suburbs, with a median property price of $330,000, came in at number three for highest first homebuyer activity and it’s easy to see why,’’ Dr Mardiasmo says.

“The area features a high level of connectivity, low entry price and close proximity to employment hubs. There is over $8 billion worth of infrastructure planned in the region, which is combined with minimal long-term supply.’’

Ironically, the research director says choosing a place to buy house and land in Melbourne is more difficult due to greater choice than in Sydney.

“Buyers have to be more concerned about long-term supply and demand as it may affect future value,’’ she says.

“The desirability of a suburb should also be a key factor in the decision making process. Apartments and subdivisions with close proximity to shops, public services and the city will almost always provide the best capital growth.

“Overall trends indicate inner city fringe and outer suburb fringe markets are the most attractive areas for first homebuyers which is expected to be the case on a national level. When done correctly buyers can secure affordable properties with good long-term growth prospects. However if buyers aren’t cautious they can buy in over supplied markets and their biggest asset could see little to zero growth.’’