This is how much the cost of buying property in regional Australia has risen since 2016
Fired up by TV shows like Escape to the Country and Escape from the City, many of us have long dreamt of fleeing from the frenzy of our urban lives to relaxed regional idylls where life would be simpler, more welcoming and a great deal cheaper.
And for many years, property was substantially cheaper in Australia’s regions. While house prices had a habit of rising quickly in the capital cities, particularly in Sydney and Melbourne, in the regions, house price growth was usually steadier, more modest and – much like the lifestyle on offer – more relaxed.
But COVID brought about a tree change to Australia’s regions not seen for generations and with it, supercharged price rises.
New data from Domain charting the time series of regional property price movements reveals the clear impact the pandemic had on demand and subsequent price patterns, illustrating the jump from slow and steady to skyrocketing growth in a short period.
The data shows that in March 2016, the median price for a house in regional NSW was $425,000.
It took more than four years for the median price in regional NSW to rise by $100,000.
| Quarter | Median house price | Annual change |
| Mar-16 | $425,000 | 6.3% |
| Jun-16 | $435,000 | 7.4% |
| Sep-16 | $440,000 | 6.0% |
| Dec-16 | $450,000 | 5.9% |
| Mar-17 | $467,000 | 9.9% |
| Jun-17 | $475,000 | 9.2% |
| Sep-17 | $475,000 | 8.0% |
| Dec-17 | $479,000 | 6.4% |
| Mar-18 | $490,000 | 4.9% |
| Jun-18 | $495,000 | 4.2% |
| Sep-18 | $490,000 | 3.2% |
| Dec-18 | $485,750 | 1.4% |
| Mar-19 | $490,000 | 0.0% |
| Jun-19 | $490,000 | -1.0% |
| Sep-19 | $499,000 | 1.8% |
| Dec-19 | $520,000 | 7.1% |
| Mar-20 | $515,000 | 5.1% |
| Jun-20 | $525,000 | 7.1% |
| Sep-20 | $540,000 | 8.2% |
| Dec-20 | $562,000 | 8.1% |
| Mar-21 | $570,000 | 10.7% |
| Jun-21 | $600,000 | 14.3% |
| Sep-21 | $640,000 | 18.5% |
| Dec-21 | $709,250 | 26.2% |
| Mar-22 | $729,000 | 27.9% |
| Jun-22 | $740,000 | 23.3% |
Then COVID came. Within less than two years – just 21 months – prices had jumped $200,000, and by June 2022, the median price was $740,000.
In regional Victoria, the median price for a house in March 2016 was $330,000. It rose by $85,000 over the 52 months between then and July 2020, the equivalent of about $19,615 a year.
In the two years since then, it’s jumped by $175,000 to a current median (as of June 2022) of $590,000.
“It’s been crazy,” said economist Dr Kim Houghton, co-CEO of the Regional Australia Institute.
“Prices just took off in 2020 when fixed interest rates were in place and, at one point, they were going up 2 per cent a month on average.
“Regional house prices rose 41 per cent over two years, which is an average, so it means that while some rose 20 per cent, some rose more like 60 per cent, and those prices have largely been maintained.”
And while the frenzied pace of growth in regional centres is slowing, areas outside of the capital city are holding up better against the falling house prices being recorded in large cities like Sydney and Melbourne.
| Quarter | Median house price | Annual change |
| Mar-16 | $330,000 | 4.8% |
| Jun-16 | $327,500 | 4.8% |
| Sep-16 | $327,000 | 4.6% |
| Dec-16 | $340,000 | 3.7% |
| Mar-17 | $350,000 | 6.1% |
| Jun-17 | $355,000 | 8.4% |
| Sep-17 | $345,000 | 5.5% |
| Dec-17 | $365,000 | 7.4% |
| Mar-18 | $370,000 | 5.7% |
| Jun-18 | $372,000 | 4.8% |
| Sep-18 | $370,000 | 7.2% |
| Dec-18 | $385,000 | 5.5% |
| Mar-19 | $380,000 | 2.7% |
| Jun-19 | $390,000 | 4.8% |
| Sep-19 | $395,000 | 6.8% |
| Dec-19 | $410,000 | 6.5% |
| Mar-20 | $410,000 | 7.9% |
| Jun-20 | $415,000 | 6.4% |
| Sep-20 | $425,000 | 7.6% |
| Dec-20 | $458,000 | 11.7% |
| Mar-21 | $465,000 | 13.4% |
| Jun-21 | $492,000 | 18.6% |
| Sep-21 | $512,625 | 20.6% |
| Dec-21 | $570,000 | 24.5% |
| Mar-22 | $585,000 | 25.8% |
| Jun-22 | $590,000 | 19.9% |
Sydney and Melbourne’s annual growth has slowed to 8.3 per cent and 5.2 per cent respectively. Regional NSW, however, is still up by 23.3 per cent over the year and regional Victoria by nearly 20 per cent.
The biggest mover over the 12 months to June was NSW’s Byron, where house prices climbed sharply over the past five years by 113.6 per cent, and 19.9 per cent over the past 12 months, to a record median of $1.81 million, dwarfing even Sydney’s median at $1,552,000.
Prices have softened slightly since, but it’s an area that remains hard to afford for most.
“I’d say we’re seeing a 10 per cent price reduction off the peak but that’s only a blink when you look at the price growth we’ve had,” said Matthew McCormack of Ray White Byron Bay. “People are still moving here, and properties are still selling.
“Some people struggle to get their heads around the property prices and the cost of having any reno or building work done.”
That median price will now buy you a four-bedroom brick-and-tile home in the area, like the one at 6 Jacaranda Drive, Byron Bay, on the market with a price guide of $1.8 million.
The region to experience the second biggest price hike was also in NSW: Kiama on the South Coast. Median house prices there rose 92.2 per cent over the past five years, and 22.2 per cent last year, to $1,595,000.
Prices have remained steady even while prices in Sydney have softened, although houses are spending longer on the market, said Stacey Da Gama of Harcourts Kiama.
“The market’s still going relatively well,” she said. “Properties are still selling at good prices.”
A three-bedroom house at 4 The Village, Minnamurra, for example, is up for auction with a price guide of $1.29 million.
The top mover in Victoria was the Surf Coast, where the house median rose 97.3 per cent since 2017, and 20.8 per cent over the past 12 months, to $1.45 million.
A three-bedroom house there, being sold for a not inconsiderable $950,000 to $1 million, has been described as “a wreck” by Great Ocean Properties’ Marty Maher.
“The house is a pushover but it’s still at a high price point,” he said of the home at 3 Robyn Road, Moggs Creek.
“Our prices are remaining steady and sales have been going OK despite the cold winter. There’s certainly still interest out there to buy.”
The flow of people leaving cities like Sydney and Melbourne since the start of the pandemic hasn’t stopped, although it’s slowed recently.
Figures from the Regional Movers Index show that during the 2021-22 financial year, Sydney accounted for two-thirds of the net migration outflows from capital cities, and Melbourne 44 per cent of net migration outflows.
In the latest financial year, each state picked up about a third of net inflows into regions – regional NSW at 33 per cent; regional Queensland at 33 per cent; and regional Victoria at 22 per cent.
“The difficulty has been that, at the same time, there’s been a significant drop in the number of people who usually move from the regional areas to the cities,” said Houghton.
“That meant they didn’t leave and didn’t put their houses up for sale, or for rent.
“As a result, the average level of stock on the market was 43 per cent below the long-term average and it was that way for the two years of COVID, so there’s been low availability of places for people wanting to move to the regions.
“And prices have made it difficult for everyone, particularly the key workers who are increasingly being shut out because of unaffordability.
“But even though the regions have seen so much price growth, even compared to the capital cities, they’re coming off a lower base, so they’re still often cheaper than the cities.”
In Queensland, regional prices have been climbing sharply, however, with the most startling rise in houses in Noosa, where the median has risen 105 per cent over five years, and 28 per cent last year, to $1,312,000.
“It just hasn’t stopped,” said Noosa4Sale agent Alex Harris.
“We’re still getting buyers buying sight unseen, so we’ve been doing 3D virtual tours for those interstate and expat buyers. There’s no longer the urgency of 2021, but buyers have more of a choice now.”
Harris is now selling a four-bedroom house at 63 Morinda Circuit, Noosaville, for $1.55 million.
“We’ve seen perhaps a 1 per cent drop in the middle range of prices, but that’s it,” she said.
“Last year, most of our interest was from Melbourne, but now it’s mostly Sydney and Canberra.”
In Western Australia, Fremantle was the area with the biggest price rise at 30 per cent over the five years, and 16.4 per cent over the past 12 months, to a median of $895,000.
Fremantle Co agent Damien Anthony said there are perhaps fewer people coming through to inspect property now, but those who are, are intent on buying.
“We’re still seeing some very good sales,” said Anthony, who’s selling a three-bedroom house at 82 South Street, Fremantle, from $880,000.
“The amount of interest we’re getting means prices won’t drop off. I reckon they’re holding up. But we are getting lots of people from the eastern states and they still see us as pretty cheap.”
Meanwhile, unit prices in regional Victoria rose by 54 per cent in the six years, from $260,000 to $400,000, and 31 per cent since September 2019.
In regional NSW, the price jumped 60 per cent from $359,500 to $575,000 – with a 26 per cent surge happening since the pandemic arrived.
We thought you might like
States
Capital Cities
Capital Cities - Rentals
Popular Areas
Allhomes
More
