The Regional Report for the March quarter shows that resource-driven regions aren’t benefiting from the ripple effect from the capital city markets.
“While low interest rates have contributed to consumer’s being more confident in property purchase decisions, not all regional centres are enjoying a boost with areas closely linked to resources sector still seeing deteriorating property conditions,” CoreLogic RP Data senior researcher Cameron Kusher said.
Queensland’s Townsville region is a prime example of this, with weakness in the region’s market evident across a number of metrics.
Sales volumes were down 10% over the year to February 2015, while median prices for houses and units over the same period fell 2.4% and 1.4% respectively.
Sales were also down in Western Australia’s Bunbury region, with house sales down 4.7% and unit sales down 9% over the year to February 2015.
Bunbury did outperform Townsville in some areas though, with slight value rises for houses and units of 1.2% and 0.4% respectively.
The Victorian regions of Geelong (0.8%) and Latrobe – Gippsland (3.9%) also saw a fall in the volume of homes sold over the period; however both regions saw small increases in the values of houses and units.
Regional NSW has also been hit by a fall in sales volumes, with the Illawarra and Newcastle regions hit by large falls in unit sales.
Over 2015’s first quarter, the Illawarra experienced a 3.1% decrease in the number of homes sold, with units down 14.4%, while in Newcastle home sales were down 2.8% with units down 18.3%
Both regions were buoyed by increases in values for both houses and units over the period.
It’s far from doom and gloom for all regional markets however, with many coastal markets likely to continue as strong performers.
“We’re starting to see greater home value growth across many coastal lifestyle markets. With mortgage rates tipped to remain low, the attractiveness of housing, particularly in some of the larger coastal regional markets, is likely to continue to show further growth over 2015,” Kusher said.
This can be seen in the Gold Coast, which has maintained strong growth over recent years.
Home values on the Gold Coast have been increasing annually since August 2013 and in the 12 months to March 2015 saw increases of 4.8% for houses and 3.9% for units.
Sales volumes for the Gold Coast were up 1.8% for the same period, which further highlights the strength of the region’s market considering over the year to February 2014, home sales were 35.1 per cent higher across the Gold Coast when compared to the previous year.
It’s a similar story for Queensland’s other coastal hot-spot, the Sunshine Coast, with house values up 6.3% and unit values up 4.7%.
In other good news for the Sunshine Coast, the past year has seen rental rates increase by 4.5% for houses and 5.7% for units, while average time on the market has also come down.
It’s also good news the other side of the Border, with strong signs for the Richmond – Tweed region in NSW.
Since 2011-2012 when the region saw its lowest sales activity on record, sales have continued to rise and are currently at 22% above the region’s five year average.
Home values for the region have also lifted over the past 12 months, up 3.6% for houses and 4.5% for units, while advertised median weekly rental rates have jumped 11.7% for houses and 7.5% for units over that period.
