Australians buying a home hoping for a future profit have been warned against investing in outer suburbs as younger people prioritise lifestyle.
Property values last month soared at the fastest pace since October 1988 with price records set in Sydney, Melbourne, Brisbane, Adelaide, Canberra and Hobart.
Buyers are piling into the market with Reserve Bank interest rates at a record low of 0.1 per cent and the big banks offering fixed-mortgage rates of less than 2 per cent.
However Brett Warren, the Brisbane director of buyer's agent Metropole Property Strategists, said property was not guaranteed to keep appreciating, and buyers had a new set of investment rules they should follow.
'The rules of property have changed and that's the way people are choosing to live,' he said.Insurance Loans Mortgage Attorney Credit Lawyer
Australians buying a home to make money are urged to avoid assuming a house in an outer suburb will surge in value because of a boom. Pictured are houses in western Sydney
Mr Warren said younger buyers are increasingly unwilling to move to an outer suburb a long way from the city centre and this trend was likely to continue for the next 15 years despite new working-from-home arrangements.
'We're not moving further and further out anymore so if you're going to do that, you're going to end up in a world of pain,' he said.
'Your investment is not going to perform as strongly and it's going to be a low demand investment and really struggle to grow in value.'
Younger buyers instead preferred being close to shops and eateries, with low maintenance homes.
'The next generation don't want to keep moving further and further out. Instead, they're moving further in,' Mr Warren said.
'They're sacrificing the big backyard for balconies and small courtyards and low maintenance areas because they want to be close to the action, where they're working, the lifestyle precincts, the coffee shops.'
Mr Warren said homes needed to be close to public