Property value growth in Australia’s regional housing market has far outpaced capital cities over the past 12 months, rising 13 per cent compared with a 6.4 per cent gain in capital city values.
CoreLogic’s quarterly Regional Market Update looks at capital growth over the 12 months to April 2021 in Australia’s 25 largest non-capital city markets.
It found the Richmond-Tweed region of northern NSW took the top spot for capital gains across both house and unit markets, with 21.9 per cent and 15.5 per cent annual growth respectively.
Conversely, Bunbury, in Western Australia, was the worst performer across both house and unit markets, with 3 per cent and -4.4 per cent annual growth respectively.
CoreLogic Research Director Tim Lawless said the overall faster pace of growth reflected stronger demand flowing into the regional areas of the country since the onset of COVID.
“This can partly be explained by the new popularity of remote and flexible working arrangements, but also increased demand for lifestyle-oriented properties and holiday homes,” Mr Lawless said.
He added that the comparative affordability of regional markets was “no doubt another incentive”.
“In April, there was a $247,400 difference between the median value of capital city dwellings and regional dwellings,” he said.
“Playing into the lifestyle trend, it’s no surprise to see the Richmond-Tweed area topping the list for capital gains over the past 12 months.
“This region includes high-profile beachside destinations such as Byron Bay, Suffolk Park and Lennox Heads as well as popular hinterland villages such as Bangalow.”
Mr Lawless said the median house value across the Byron council area was $1.4 million, which is higher than Greater Sydney’s median of $1.147 million.
“Looking forward, regional housing markets remain well placed to record higher than average levels of demand,” he said.
“Especially those markets that are located close enough to capital cities to provide a commuting option, and those lifestyle markets that are popular with sea and tree changers.“
Mr Lawless noted that although surging values spelled good news for homeowners it also meant affordability was being stretched for those trying to enter the market.
“Particularly for long-time locals whose incomes are unlikely to be rising at anywhere near the pace of house price appreciation, they may be forced to seek out housing options further afield.”
Despite recording the lowest level of annual growth, Bunbury had the largest change in the number of houses sold across the region, up 51.4 per cent over the year to February 2021.
This was followed by Central Queensland, where house sales increased by 48.4 per cent, and New England and North West in New South Wales (45.1 per cent). Meanwhile, the Launceston and North East region in Tasmania was the only region in this report to see a decline in house sales over the 12 months to February 2021 (-10.1 per cent).
The fastest-selling region for houses over the year to April 2021 was Ballarat, in Victoria, where it is currently averaging 24 days to secure a sale, followed by Newcastle and Lake Macquarie, in NSW, at 26 days, and Illawarra, NSW, at 27 days.
The region with the longest days on market over the year was the NSW’s New England and North West region, where houses are taking 84 days to sell.