could geelong be where the next property boom is for 2024
The regional Victorian property market has yet to see substantial price growth, but a new boom could be on the way. Image: Canva.
  • Regional Victoria hasn't seen the price growth other regional markets have experienced, but that may soon change.
  • Recent sales data points towards the possible start of a new cycle in regional Victoria.
  • Subtstantial economic growth and employment opportunities set to bolster the attraction to locations such as Geelong.

Regional property markets still have plenty to offer investors despite almost three years of solid growth; it is also the more sensible option than jumping into long overheated Australian housing markets.

For 2024, I’m picking the regional Victorian property market as a solid performer and avoiding the recent hot favourite, Perth.

In justifying why Perth is no longer the flavour of the month, the reason behind Perth’s recent success can also explain why the regional Victorian property market is about to take off.

Why is Perth’s property market no longer my top pick?

I’d warn investors who are still looking at the Perth market to be wary that they are likely buying at the peak or in a declining market. Investors must look at the markets that will perform well, not those that have already taken off.

Perth is a classic example of that. Buyers are falling over themselves and paying over the odds to secure a piece of that market. Investors should no longer be buying in overheated markets like Perth, but targeting locations with credentials for long-term growth which may be at a current low point in the cycle.

How can this be determined?

The latest sales data indicates that the Perth market has reached its peak in terms of buyer activity and is not likely to continue leading the nation in price growth. The rate of growth is expected to slow down as the year progresses.

A new analysis of sales activity has shown a significant decrease in activity across Greater Perth after three years of strong performance. The market was previously dominated by rising, recovering and consistent suburbs, with no declining markets.

Currently, Hotspotting’s analysis found that only 15 suburbs are classified as rising markets out of 237. Nine months ago, the majority of suburbs had positive classifications, with only three declining ones.

This confirms previous warnings that now is a risky time for investors to buy in the Perth market. Although sales activity has decreased, there are still enough buyers in the market to drive up prices, fueled by media coverage claiming that the boom will continue for several more years.

However, many buyers are making hasty decisions without considering important factors like location, pricing, and due diligence, and may regret their choices later. The sales volume data shows a significant decline in the March 2024 quarter, down by 25% compared to the previous quarter.

These are some exceptions in the Greater Perth market, which has likely reached its peak and will not continue leading the nation in price growth much longer. Regional areas such as Bunbury and Geraldton, have good growth prospects and offer affordability and high rental yields. These markets are supported by strong regional economies.

Early signs of growth for regional Victoria

The market that now meets the criteria for long-term growth which may be at a low point in the property cycle is regional Victoria.

In simple terms, the markets in regional Victoria are situated where Perth was three years ago before prices started to soar.

If you are buying strategically for capital growth, it is a market that is underpinned by one of Australia’s strongest state economies and with strong population growth expected to continue, so too is demand for real estate.

While regional Victoria hasn’t experienced the price growth of other regional markets in the past year, Hotspotting’s latest Top 5 Regional Victorian Hotspots report has identified a big leap in buyer activity across recent months – often a precursor to future property price growth.

Vacancy rates also remain very low and rents are rising.

Top 5 regional Victorian housing markets

  1. City of Greater Geelong
  2. Mitchell Shire
  3. City of Ballarat
  4. Albury/Wodonga
  5. Latrobe Valley

Geelong hailed as a prime opportunity

A rapidly growing economy is one driver behind why Geelong is shaping up to be a great place to invest.

It has had $5.5 billion in recent infrastructure expenditure and a projected $17.4 billion in major investments to come, which fueled job creation and therefore demand for housing.

Geelong’s population and gross regional product growth are above the national average, and the city is in the midst of a major urban expansion plan that will cater to 110,000 new residents and create 35,000 jobs by 2050.

Despite the 2026 Commonwealth Games cancellation, Geelong is still expected to receive planned sporting infrastructure projects. further enhancing the attractiveness of Geelong as both a place to be and invest.

First home buyer activity in the city is also picking up across certain areas of Geelong due to the availability of vacant land.

Employment opportunities to pick up

Hotspotting’s latest report also revealed a growing number of major private firms and international companies choosing Geelong as a place to call home.

In recent decades, the Transport Accident Commission shifted headquarters there, with other major companies such as KPMG, Hanwha, Petstock, Cotton On, Amazon, and Australia Post all setting up shop at Avalon Airport’s industrial and business precinct in 2023.

The airport, more generally, is also expected to be the centre of attention in the years to come, with significant plans on the way.

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