Australia’s regional property markets continue to outperform their metro counterparts, but price growth is cooling.
Regional dwelling values rose 1.1 per cent in the three months to October, compared with 0.8 per cent in the cities, according to the latest CoreLogic Regional Market Update.
The respective growth rates have softened from 2.3 per cent and 2.2 per cent respectively in the quarter to April.
Mining regions in WA and Queensland led the charge, with property values in Mackay, Geraldton and Townsville up 8.8 per cent, 8.2 per cent and 6.6 per cent, respectively.
Over the year to October, dwelling prices in each of the three markets surged by more than a quarter, driven by affordability and lifestyle appeal, CoreLogic economist Kaytlin Ezzy said.
“But even with the impressive growth, for those with the capacity to service a mortgage, they still remain attainable with medians less than $600,000,” Ms Ezzy said.
In NSW and Victoria, there were signs of cooling in markets that had run hot during COVID-era tree and sea changes.
Seven out of eight Victorian non-capital significant urban areas posted value drops, along with 10 of 21 equivalent regions in NSW.
The holiday town of Batemans Bay on NSW’s southern coast fell the most with a 2.7 per cent slump over the quarter, followed by Warrnambool on Victoria’s southwest coast, where values sunk 2.6 per cent.
“There’s certainly been a slowdown in demand for these areas and more stock on the market and that’s in addition to higher interest rates, cost of living pressures, and limited borrowing capacity” Ms Ezzy said.
Over the year, 10 property markets in the southeastern states posted declines, led by a 6.3 per cent fall in the town of Ballarat in central-western Victoria.
Regional rental prices grinded 0.5 per cent higher over the three months, but held steady on average across capital cities.
As for mortgage affordability, Westpac economists recently joined NAB in pushing expectations of a Reserve Bank interest rate cut from February to May 2025.
ANZ and CBA economists still expect the RBA to ease the cash rate for the first time in more than four years in February 2025.
REGIONAL PROPERTY VALUES AT A GLANCE:
– Highest quarterly growth: Mackay (Qld) – 8.3 per cent
– Lowest quarterly growth: Batemans Bay (NSW) – minus 2.7 per cent
– Highest annual growth: Geraldton (WA) – 28.7 per cent
– Lowest annual growth: Ballarat (Vic) – 6.3 per cent
– Shortest days on market: Bunbury (WA) – 13 days
– Longest days on market: Batemans Bay (NSW) – 72 days
REGIONAL RENTALS AT A GLANCE:
– Highest quarterly rental growth: Albany (WA) – up 3.0 per cent
– Lowest quarterly rental growth: Batemans Bay (NSW) – minus 2.4 per cent
– Highest yearly rental growth: Geraldton (WA) – 14.6 per cent
– Lowest yearly rental growth: Burnie – Somerset (Tas) – 1.8 per cent
– Most affordable: Burnie – Somerset (Tas) – $408
– Least affordable: Gold Coast – Tweed Heads (Qld and NSW) – $833
