According to recent reports, almost every council area in NSW outside of Sydney recorded double-digit price growth in the year to June. Similar regional property growth has been recorded in Victoria and Queensland.

As Arjun Paliwal, Investorkit founder, informed Yahoo Finance: “There are still plenty of regional areas with strong growth potential, due to common factors, including an undersupply in both properties for sale and rent, booming local job markets, a strong outlook of infrastructure development in the pipeline, accessible lifestyle, and affordability.”

Some regional areas have shown as much as 50% growth in value

Areas that have performed well in NSW include the Murray River council area, the Hunter Valley, and the Snowy Monaro Regional area – an area we highlighted in our recent post about alpine real estate. Some of these areas have shown almost 50% regional property growth and certain towns closer to the beach such as Bellingen, have shown an almost 40% increase in value.

In Victoria, North Central Victoria, Hume and Warrnambool and the southwest region stand out as the top performing areas for growth, with an increase of between 30 and 40% in certain areas.

What has triggered this unprecedented regional property growth?

1. Millennials and Generation X retirees needed a solution to their housing problem. It may be hard to believe, but Millennials are reaching an age where some of them are thinking about children. They need more space, and flexible working conditions are helping them take advantage of the lower entry point into the market these regions offer. Many Gen Xers are ready to retire, which means moving out of the cities and downsizing. 
2. The increasing popularity of the “tree change”. The pandemic was a timely reminder of the importance of our health – physical and mental - and making the most of each day.
3. The large-scale interstate migration from Victoria to NSW – possibly for the lower stamp duty rate or to escape harsh lockdowns – and for some, up to Queensland in search of greater affordability and the more favourable climate and relaxed lifestyle the Sunshine State offers.
4. The lower entry point to buy property in terms of the deposit is a big draw for Millennials and first-home buyers who have struggled to save with the increasing cost of living.
5. The investment and improvements in infrastructure that have been put in place in these areas by the State and Federal governments in terms of travel, new housing, and local amenities have also boosted local employment. These incentives have turned the dream of a move to the country into a practical reality for many.
6. The lower unemployment rate in regional towns is a huge factor in drawing in migrants now our borders are open again. The agriculture and construction industries are booming, and there are also jobs to be found in wineries, the Snowy Hydro 2.0 project in Alpine NSW, new technology hubs and medical and health services.

Tamworth is the perfect example of an area to watch, as Terry Ryder of Money Magazine pointed out in February this year: “The key drivers in 2022 will be the exodus-to-affordable-lifestyle trend and major infrastructure spending,” he said. The perfect partnership between good infrastructure and some special appeal about the area – whether that has to do with its geography, history or culture - will ensure that the area “evolves from a rural centre with a country music tradition to a significant hub for transport and renewable energy.”

Queensland is a “national leader” in terms of growth

It is also worth mentioning that it was Terry who predicted that regional Queensland would become “a national leader” in terms of growth in areas like the Sunshine Coast, the Gold Coast, Hervey Bay, and Townsville.

The main reason for these soaring prices is obviously linked to the steady migration of workers who have greater employment flexibility since COVID. And for the moment, despite the recent slump in prices, there is little sign that this trend will abate so long as prices to buy and rent in our cities remain high. 

Ultimately, experts believe that the rise in interest rates and inflation will impact prices in regional areas in the same way they are affecting city prices, but their influence will be more gradual because of the lower entry point for buying, the consistently high level of demand, and the dearth of housing left in these areas.

No one can confidently predict which way the property market will go, but many property experts agree that the following three areas on the east coast are potential hotspots to watch:

1. Tamworth in NSW
2. Bundaberg in Queensland
3. Albury-Wodonga in Victoria

For any hope of success in the market, investors understand the importance of keeping their finger on the pulse. And the main way to do that is to access property BEFORE it hits the market. Buying and selling off-market is Listing Loop's speciality, and with the unpredictability of the current climate and the money we save our members, more people are coming to us for help. If you are ready to buy, sign up with us today for FREE to access exclusive off-market properties around Australia.

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