The property market is a complex beast, and it's easy to get caught up in the hype and doom-mongering. But what if I told you that the regional hotspots are outperforming the capital cities? Yes, you heard that right. According to Kane Dury, principal of Discover Buyers Agency, the regional cities are the real winners in Australia's property market.
What makes this particularly fascinating is that the national numbers driving the 'downturn' narrative are really just a reflection of Sydney and Melbourne. The regional centres are quietly strengthening, and the data supports this. Overall values fell in June because Sydney and Melbourne prices softened, but strip out the biggest cities, and you'll find regional Australia is not just holding up, but outperforming the capitals on almost every measure.
In my opinion, this is a complete reversal of the old assumption that the regions lag the cities. Right now, it's the capitals that are lagging behind. When people hear 'the Australian market fell last month', what they're really hearing is that Sydney and Melbourne fell. Those two cities alone carry so much weight in the national figures that they can drag the headline number down even while dozens of other markets are doing well.
One thing that immediately stands out is the strength of regional markets. The PropTrack home price index for June showed that regional areas across the country recorded no change, while regional NSW was up 0.1 per cent. Melbourne showed no change, while regional Queensland recorded a 0.1 per cent drop. The strongest performing parts of the market continue to be those offering the greatest affordability, and regional markets outperformed capitals over both the month and the year.
What many people don't realize is that there is no such thing as 'the Australian property market'. There are hundreds of markets, and right now many are moving in opposite directions. The regional surge is being driven by structural forces, not sentiment. Severe rental shortages with regional vacancy rates around 1.5 per cent, affordability refugees priced out of the capitals, sustained internal migration, and chronically constrained new housing supply are all factors.
Personally, I think the regional cities that offer the strongest combination of value, rental demand, and economic diversity for buyers in the $700,000 to $1 million bracket are Toowoomba, Townsville, and Mackay in Queensland, as well as Geelong, Bendigo, and Ballarat in Victoria. These cities have established homes on big blocks still available under $800,000, and their economies are diversified across health, education, agribusiness, and more.
If you take a step back and think about it, this makes sense. The regional cities are not just holding up, they're outperforming the capitals. The data supports this, and the structural forces driving the regional surge are clear. So, if you're looking for a property investment, consider the regional hotspots. They may just be the next big thing.
