The December quarter regional market update produced by CoreLogic shows a change in direction where for several quarters, the NSW Illawarra region topped the list as the country’s best performing regional market.
Move over Illawarra, striding ahead over the quarter was the Geelong region which recorded the largest annual increase in house values, up 14.6 per cent, while the largest annual increase in unit values was seen across the Illawarra region (12.8 per cent).
In contrast, Townsville and Bunbury were the only regions to see values for both houses and units fall over the year to December 2017 and the only regions to see rental rates fall over the 12 months to December 2017. Simultaneously, the Gold Coast recorded the biggest fall in sales activity; dwelling sales dropped by -11 per cent over the year to December 2017.
The Richmond-Tweed region saw houses record the largest increase in advertised rental rates, up 7.8 per cent ($35/week) over the year to December 2017.
Commenting on the regional market performance over the quarter, report author Cameron Kusher said, “That the regional markets analysed have for the most part seen quite strong increases in values highlighting that demand for housing in these markets continues to grow as capital city markets hjave started to see values fall.”
According to the CoreLogic results, all three regions across New South Wales experienced growth in home values over the year to December 2017. The largest of the increases was for houses across the Newcastle and Lake Macquarie region with median house values increasing by 12.9 per cent.
On the other hand, the Illawarra region recorded the largest increase in unit value with a median unit increasing by 12.8 per cent. In terms of sales activity, Richmond-Tweed recorded the biggest fall in sales activity with transactions down -6.7 per cent, or 452 fewer homes selling when compared to November 2016. Rental rates increased across all three regions, with Richmond-Tweed houses recording the largest increase (7.8 per cent), while the largest increase in rental rates for units was recorded across the Illawarra region (5.0 per cent).
Across Queensland, dwelling sales fell in four of the five regions over the year to November 2017 with the largest fall seen across the Gold Coast, where sales volumes are down -11.4 per cent, followed by the Sunshine Coast (-7.2 per cent), Cairns (-3.5 per cent) and Townsville (-2.4 per cent). Across the Wide Bay, sales are in line with one year ago. Townsville was the only region to see values fall for both houses and units, down -2.1 per cent and -4.0 per cent respectively, while the Gold Coast and Sunshine Coast were the only regions to see increases in both house and unit values. In Wide Bay, values fell slightly for units (-0.5 per cent) and increased by 0.6 per cent for houses, while for Cairns, median house values increased by 1.3 per cent, and median unit values fell -2.3 per cent.
In Victoria, sales activity was down -3.6 per cent across Geelong, while the Latrobe-Gippsland region saw a slight increase (0.9 per cent) in the amount of homes transacting over the year to November 2017. Both regions saw home values increase over the 12 months to December, with values increasing by 14.6 per cent for houses and 10.7 per cent for units in Geelong, compared to the Latrobe-Gippsland region, where house and unit values increased by 5.1 per cent and 3.6 per cent respectively.
Western Australia’s Bunbury region saw house values fall -1.6 per cent over the year to December 2017, while unit values fell -4.6 per cent. Sales volumes across the region fell -1.9 per cent over the 12 months to November, with current activity -12 per cent below the five year average. Rental rates in the Bunbury region fell -2.9 per cent for houses and -4.7 per cent for units when compared to December 2016.
Looking forward Mr Kusher noted that: “With capital city values generally slowing or falling over recent months it is reasonable to expect that this may lead to slower overall growth in regional markets too. Nevertheless, over the coming months we expect values to continue to rise in most regional markets and outperform their capital city counterparts.”