- Significant value growth attributed to affordability, credit access and work flexibility
- Days on the market falling due to tightened stock levels and strong buyer demand
- Longevity of price growth dependent on maintained affordability, says Tim Lawless
Australia’s 25 largest non-capital city regions have seen a record-breaking increase in house values over the past year, according to CoreLogic‘s Regional Market Update.
CoreLogic attribute the widespread spike in housing values to an ease of access to credit, working from home allowances brought about by restrictions, and affordability advantages.
Double-digit value growth in most areas
Of the 25 regions examined in the Update, 24 observed a double-digit growth in values when compared annually. More than half of these saw an annual rise that exceeded 20%.
An annual change exceeding 30% was recorded in seven regions, reflecting the hot market conditions across the nation.
Tim Lawless, Research Director at CoreLogic, said the each region was subject to localised factors but trends in a shift towards regional areas, low interest rates, easier access to credit, increased savings and relative affordability was seen across the board.
“There has been a broad demographic shift where more Australians are prepared to consider housing options outside of the capital cities, which has seen net internal migration rates to regional Australia reach record highs.”
Tim Lawless, CoreLogic Research Director
Mr Lawless added that working from home seems to be here to stay, and as a result more workers are turning to regional areas with more flexibility in their working lives.
Top performing regions
Topping the chart for the highest annual value growth was New South Wales’ Southern Highlands and Shoalhaven region, with a 35.9% growth.
The Richmond-Tweed region also in New South Wales, and Queensland’s Sunshine Coast followed closely behind with rises of 32.8% and 32.3% respectively.
“The top performing regional areas were all coastal or lifestyle markets generally within a two-hour commuting distance of a capital city.
“These areas fit within the broad trend where demand has surged for lifestyle properties that offer a blend of liveability and commutability,” said Mr Lawless.
Queensland’s Townsville, whilst the region to record the lowest annual growth despite being in the midst of its strongest market conditions since 2017, still recorded a respectable price growth of 8.0%.
Notable market indicators
As for the unit market, of the 22 applicable regions 18 of these recorded a growth of at least 10%. 12 of these saw values grow by over 20% in the past year.
The top performing region was Queensland’s Wide Bay at a 29.2% growth with the Sunshine Coast only losing out marginally, its value growth at 29.1%.
Stock flew out the door quickest on the Gold Coast, houses only spending a median of 18 days on the market.
In contrast, homes in New South Wales’ New England and North West spent around 62 days on the market before selling.
The impacts of reduced stock levels and strong buyer demand were evident, resulting in a significant fall in days on the market and vendor discounting rates across the board.
“This mismatch between available supply and demand has created a heightened level of urgency amongst buyers, generating strong selling conditions where homes are snapped up quickly with minimal levels of negotiation,” Mr Lawless said.
Affordability in focus for price boom longevity
According to Mr Lawless, the durability of the current regional boom will depend on how well the areas maintain their affordability following value increases.
He added that he expects areas within a reasonable commuting distance to CBD’s to remain in high demand with the unpredictable nature of workforce arrangements.
“If housing values across regional parts of the country continue to outpace the capitals, the obvious outcome will be that regional markets lose their affordability advantage.”
Tim Lawless, CoreLogic Research Director
“We can already see this trend taking shape in some of the most popular regional coastal markets such as Byron Bay where median house values are $1.7 million and Noosa on the Sunshine Coast in Queensland, where median house values are $1.2 million, much higher than comparable capital city values,” Mr Lawless concluded
