Data from CoreLogic's quarterly Regional Market Update shows property values in Australia's 25 largest non-capital city markets surged 13.0% in the last 12 months, compared with a 6.4% gain in capital city values.
CoreLogic research director Tim Lawless said this reflects the growing demand from Australians to escape the big smoke in favour of a tree or sea change during the pandemic.
“This can partly be explained by the new popularity of remote and flexible working arrangements, but also increased demand for lifestyle oriented properties and holiday homes," Mr Lawless said.
"No doubt the more affordable housing options across many of Australia’s regional markets is another incentive; in April there was a $247,400 difference between the median value of capital city dwellings and regional dwellings."
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The report, which looks at capital growth over the 12 months to April 2021, saw Richmond-Tweed take out the top spot for capital gains across both house and unit markets, recording 21.9% and 15.5% annual growth respectively.
“Playing into the lifestyle trend, it’s no surprise to see the Richmond-Tweed area topping the list for capital gains over the past 12 months," Mr Lawless said.
"This region includes high profile beachside destinations such as Byron Bay, Suffolk Park and Lennox Heads as well as popular hinterland villages such as Bangalow.
"The median house value across the Byron council area is now $1.4 million, which is higher than Greater Sydney’s median of $1.147 million."
See also: Top 10 affordable Australian regional areas in 2021
Bunbury was the worst performer for both house and units, recording 3% and -4.4% yearly growth respectively.
Mr Lawless said house prices are likely to continue rising in regional Australia, to the detriment of locals who are being pushed out.
“Looking forward, regional housing markets remain well placed to record higher than average levels of demand, especially those markets that are located close enough to capital cities to provide a commuting option, and those lifestyle markets that are popular with sea and tree changers," he said.
“While surging values are probably good news for homeowners in these regions, for those that don’t own a home, affordability is being stretched.
"Particularly for long-time locals whose incomes are unlikely to be rising at anywhere near the pace of house price appreciation, they may be forced to seek out housing options further afield."
Photo by Stephen Tafra on Unsplash
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