Regional markets strengthen with values and rents reaching new record highs

Key takeaways

Regional home values hit a new record high in April, after recording a nominal recovery in March.

Dwelling values across the combined regions are rising at the fastest pace in almost two years.

Across the country's 50 largest non-capital city Significant Urban Areas (SUAs), 19 markets are at a record high.

Victoria and NSW were home to the weakest markets over the past three months, with Ballarat and Port Macquarie both down -2.0%.

Rents across the combined regions are also at a record high, with 37 of the 50 largest SUAs at a peak.

Growth in Regional Australia’s dwelling values and rents continued to pick up pace over the past three months, taking both to new record highs, CoreLogic’s Regional Market Update shows.

Dwelling values across Regional Australia rose 2.1% in the three months to April 2024, the fastest quarterly growth rate in almost two years, outperforming capital city values which rose 1.7% in the same period.

The recent capital growth saw the combined regions record a nominal recovery in March and, subsequently, a new record high in April.

After falling -5.8% between May 2022 and January 2023, regional home values have seen a slower recovery compared to capital city values but have now regained the losses from the downturn to reach a new record high.

Across the country's 50 largest non-capital cities Significant Urban Areas (SUAs) featured within the report, 19 markets are at a record high.

Western Australia is home to some of the best-performing regional markets spotted along its coastline.

Geraldton had the largest gains over the past three months, up 8.8%, followed by Busselton (7.7%) and Bunbury (6.4%).

Bunbury boasted the largest growth over the past year, up 20.7%, and the fastest selling time of just 14 days.

Albany had the smallest vendor discounting at -2.8%.

Queensland made up four of the remaining top 10 SUAs for quarterly growth, while

New South Wales, South Australia and Tasmania each saw one market in the top 10.

The diversity in economic activity across these parts of regional WA and Queensland including agriculture, tourism, ports and mining would be contributing to the strength of these markets, along with their higher levels of interstate migration, relative affordability and low supply levels.

The worst-performing regional markets were in Victoria and NSW, with Ballarat and Port Macquarie both down -2.0% over the past three months.

Ballarat also had the weakest annual change, down -4.2%.

Markets in the Southern Highlands & Shoalhaven and capital regions of NSW had some of the worst selling conditions, with Batemans Bay offering the highest vendor discounts at 6.5% and Bowral Mittagong recording the highest median time on market at 75 days.

Rents re-accelerate across the regions

Annual rental growth across Regional Australia continued to accelerate, with rents rising 6.3% over the 12 months to April, up from 4.9% over the year to January.

By comparison, annual rental growth across the combined capitals eased from 9.6% to 9.4%.

Across the 50 largest non-capital SUAs, 37 markets have rents at a record high, with almost all recording rent increases over the past three months (47 markets) and past year (48).

After recording rental declines throughout 2023, Batemans Bay saw the largest quarterly increase in rents, up 6.0% or $32 per week over the three months to April, followed by Bunbury (4.7%) and the Sunshine Coast (4.4%).

Bunbury had the largest annual rental growth, up 16.4%, while Kalgoorlie – Boulder had the highest gross rental yield at 9.4%.

Tasmania’s Burnie – Somerset was the most affordable rental market at $419 per week, while the Gold Coast – Tweed Heads border region was the most expensive rental market at $827.

Just three SUAs recorded a quarterly decline in rental values, Nowra - Bomaderry (- 0.3%), Maryborough (-0.2%) and St-Georges Basin – Sanctuary Point (-0.1%), while Batemans Bay and Goulburn were the only other SUAs to record an annual fall in rents (-2.4% and -0.1% respectively).

Housing affordability has continued to deteriorate through the start of 2024 for tenants and prospective home buyers alike.

The outlook for regional housing markets will heavily depend on demographic trends, housing supply, localised economic drivers and the outlook for interest rates.

About Kaitlin Ezzy Kaytlin is a skilled research analyst and key member within CoreLogic’s research team. She specialises in collating large and customised data sets, data visualisation and residential data reports. www.Corelogic.com.au