For several years now, regional markets have been out-performing capital city markets on buyer demand and price growth.
According to the data from many different research sources, the regions have been the big achievers in Australian residential property.
The trend we call The Exodus to Affordable Lifestyle has been under way for much of the past decade and this has been reflected in price data for several years.
In 2020, the combined capital cities rose less than 3% while the combined regions increased more than 7%.
In 2021, the combined capital cities rose 23% but the combined regions rose 26%.
In 2022 to date, the capital cities have dropped 3.2% but the regions have risen 6.4%.
One of locations which has been at the forefront of this trend of out-performance by markets outside of the big cities, has been Regional Victoria.
Many Melbourne residents have relocated to regional areas of the state, with notable population drift for the past five or six years.
Initially, this internal migration was focused on regional centres close to the state capital but more recently there has been impact for cities and towns further afield.
As a result, the regional areas of Victoria have been strong market performers for many years.
Key cities like Ballarat, Geelong and Bendigo have produced exceptional price growth for the past four or five years – and continue to do well.
Other locations in Regional Victoria – including Wodonga, Warrnambool, the towns of the Latrobe Valley, Shepparton, Bright, Mildura, the towns of East Gippsland and many more – have delivered big price increases more recently.
And the strength of the Regional Victoria market continues.
While some locations are less buoyant now than in 2021, in most parts of Regional Victoria we are still seeing strong sales activity and stubborn resistance of the downturn forces which have afflicted the big capital cities.
There is no sign of slowdown in the Exodus to Affordable Lifestyle trend in this state.
And Regional Victoria is likely to experience another wave of buyer demand because of the 2026 Commonwealth Games, to be hosted by key regional centres throughout Victoria.
This is the first time the Commonwealth Games, one of the biggest sporting events on the globe, has been held in a series of regional centres.
Normally, the Games is hosted by a single major city – including the Gold Coast in 2018 – but in 2026 the events will be staged in Ballarat, Bendigo, Geelong, Shepparton and East Gippsland.
This will necessitate major investment in infrastructure to get ready for the big event, including transport, accommodation and sporting infrastructure.
History shows that the biggest impact for real estate from a global sports event comes before, not after, the event.
This is because the construction activity and other investment generates major economic activity and jobs, and from that springs demand for real estate.
The Commonwealth Games will also bring national and international focus to Regional Victoria and that will bring increased demand for real estate.
Vacancies are already low in most locations and this will exacerbate the shortage issues, causing rents to rise.
So the future for real estate in Regional Victoria looks healthy and we can expect to see good demand from both home-buyers and investors, leading to a continuation of the state’s good recent performance on prices and rentals.
