They might be few and far in between but it’s possible to find an affordable property under $500,000 in the capital cities, if you know where to look.

Anna Porter, property commentator, valuer and Suburbanite CEO, says it’s possible to crack into the property market with a budget of $500,000 but also issued a word of caution.

“It’s a budget where you do have to be careful. Sometimes people think if it’s a cheap property, you can’t go wrong, but sometimes cheap to buy means cheap to sell. You do have to make sure you’re getting the right property and not having too many fundamental issues with the property at that price point,” warns Porter.

There’s no secret you can buy property in Sydney and Melbourne for $500,000 if you’re ready to do some compromising.

“If you’re an investor chasing growth in the next three to five years, you’re not going to find it in Sydney or Melbourne,”

“But if you’re a first home buyer trying to get onto the property ladder, now could be a great opportunity and if you are sub $500,000 you can get in but you do have to make some compromises,” says Porter.

31/144 Moore Street, Liverpool, NSW was sold for $380,000 in October this year.

“This property is a small unit and does have a lot of value for money for under $500,000. You can see how oversized the lounge is compared to the small living space. You do get 2 beds and car accommodation and the bathroom is updated which are the big ticks,”

“This unit is in a pocket that has a lot of older units and a high proportion of government style housing. The prices are held down because of that and the unit market being very oversupplied in this location and Sydney in general. You just won’t pick up a free-standing house in Sydney metro for this budget,” says Ms Porter.

20 Cox Road, Victoria is currently a 2-bedroom house on the market in Victoria for $380,000 to $400,000.

“Again, this is an area that has a higher percentage of government style housing and there are some pockets that have a bad reputation with the locals,”

“It is also a very original 2-bedroom house but the real tick here is that you get land content. It is however 1 hour out of Melbourne but it has great infrastructure, amenities and is commutable,”

“But this is an indication of how far out of Melbourne metro you need to go to get some land content for sub $500K in an established area,” said Anna.

Now to compare the Sydney and Melbourne sub $500,000 properties to a property in one of Anna’s ‘hotspots’, 8 Arkle Place, Woodcroft, South Australia has been used.

The 3-bedroom property is currently on the market for $419,000 to $439,000.

“Comparatively you get a very modern home with a small land parcel but is only 30 mins from the CBD in a suburban family area. This is very well positioned for growth,” says Porter.

Anna Porter also refers to Canberra as her second favourite sub $500,000 hotspot.

9 Finey Close, Dunlop, ACT is currently on the market for $449,000.

“Dunlop is a suburb that is on the very outer fringe of Canberra metro and is almost in NSW. It is adjoining some of the older suburbs and some of which have a high volume of government housing and indicators of disadvantage,”

“This is more modern villa style house with small land content but is modern and has 3 bedrooms. The growth will be pulled along by the general Canberra movement but this is certainly an entry level property for this market,” says Porter.