The latest CoreLogic Property Pulse data shows regional property is currently strong with rises in both house and unit prices, as it is experiencing a flow-on effect from capital city activity to May 2017.
CoreLogic’s research analysed the 50 most populous non-capital city council areas, which found a pick-up in housing demand due to buyers looking away from capital cities, according to CoreLogic research analyst Cameron Kusher.
“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,” Mr Kusher said.
“Overall, we’re seeing housing demand in regional areas of the country is rising.
“While many regions are seeing values increase, the strongest demand appears to be in those areas within relatively close proximity to capital cities, particularly those which are coastal and tap into lifestyle demand.”
The top three areas that saw the most growth over the 12-month period for houses were Wollongong at a rise of 17.6 per cent, followed by Shoalhaven at 16.4 per cent and Shellharbour at 15.6 per cent, all located in NSW, and for units were Shellharbour at 16.6 per cent, followed by Shoalhaven at 14.7 per cent.
Meanwhile, the areas that saw the largest falls for houses were Gladstone at a fall of 11.5 per cent, Mackay at 6.3 per cent, both from Queensland, and Bunbury with 5.5 per cent from Western Australia, and for units were Gladstone again at a fall of 23.7 per cent, Geraldton-Greenough from Western Australia at 12.1 per cent, and Scenic Rim from Queensland at 5.4 per cent.
Regional areas close to Sydney are seeing the strongest growth in NSW, such as Wollongong, which is the most expensive for houses at a median value of $730,427 and units at a median value of $530,170, holding records for the greatest increase in house values and fourth highest for unit values.
“Places like Wollongong are on the rise as demand ripples away from Sydney where affordability constraints are more pressing,” said Mr Kusher.
Regional areas in Victoria close to Melbourne also saw growth, but not as great as property in Sydney, Mr Kusher said.
“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,” he said.
Non-capital city Queensland, however, saw very little growth, with some falls recorded too. The better off areas include the Gold Coast, Sunshine Coast and Noosa.
“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,” explained Mr Kusher.
Of all the areas researched by CoreLogic, the key takeaways were:
- Every one of the 24-regional area for NSW recording growth for houses, with four recording falls for units.
- In Victoria, out of 10 areas, two recorded falls for houses and two areas also recorded falls for units, with Greater Shepparton recording falls for both property types.
- For Queensland, out of 13 areas, five recorded falls for houses and seven recorded falls for units.
- Every region analysed in Western Australia recorded falls for both property types.
- Tasmania’s Launceston was the only non-capital city area in the state that recorded a rise for both houses and unit values.