Often considered to be obstinately sluggish during the upturn in a property market cycle, Australia’s regional property markets are currently experiencing the flow-on effects from strong capital city market activity, according to the latest CoreLogic Property Pulse report, released on Thursday.
Covering the 50 most populous non-capital city council areas, the report noted a rise in house and unit values over the past 12 months to May 2017.
“After a long period of soft housing market conditions [post-GFC], we’re seeing a pick-up in housing demand across these regions as buyers look outside the capitals for more affordable options,” said Cameron Kusher, research analyst at CoreLogic. “While a majority of the regions are showing an upward swing, areas linked to the mining and resources sector are continuing to see values fall.”
New South Wales
Areas close to Sydney are seeing the strongest growth in NSW, according to the report.
The Wollongong council area is the most expensive for houses and units, with median values of $730,427 and $530,170 respectively. The area also recorded the greatest increase in unit value over the past year.
“Places like Wollongong are on the rise as demand ripples away from Sydney where affordability constraints are more pressing,” Kusher said.
Victoria
Regional areas that are close to Melbourne are experiencing the strongest value growth. However, this is nowhere near the magnitude of the value growth in areas close to Sydney.
“Although values are rising, the softer growth can be linked to the fact that values have not risen as sharply in Melbourne as they have in Sydney, and subsequently, affordability hasn’t deteriorated as severely in Melbourne,” Kusher said.
Queensland
The results are more mixed in this state, as the southeast corner is generally seeing values rise. But across the remainder of the state, growth is either extremely mild or has fallen.
The Gold Coast, Sunshine Coast, and Noosa are now seeing more rapid value growth than Brisbane. “It seems as though much of the demand across these regions is coming from an acceleration in internal migration to Queensland, and where buyers from Sydney and Melbourne are using substantial equity earned to secure lifestyle properties in the state,” Kusher said.
Related stories:
CoreLogic: Capital Gains Performance Lower This Decade
Where Should You Invest In 2017?
