Regional Property Outperforming The City

Property prices in regional Australia have been surging since COVID-19 first hit in early 2020.

Now, a quarter of the way through 2021, it looks as though this trend is set to continue.

We look at how this national phenomenon is playing out in our local area and what it means if you’re looking to buy or sell property in Singleton and the Hunter Valley.

A local flavour to a national trend

2020 may have been a trying year on many fronts but it was a good one for property prices in regional Australia.

While prices across our metropolitan areas rose by an average of only +1.7% (and even fell -1.3% in Melbourne), prices in regional Australia lifted an average of +7.9%, making it almost the best year for regional property in the past decade.

The housing market here in the Hunter Valley has outperformed even this impressive average. The median house price in Singleton has now lifted to $412,000, a rise of 11.4% compared to April 2020. Units haven’t fared quite as well, with the median price rising 4% to $223,750 over the same time period. However, it’s important to note that unit prices have underperformed house prices nationally. In Sydney, the average unit price actually fell -0.2% over 2020.

A mix of factors driving regional property prices upwards

The regions have rarely been more popular than right now.

In light of the pandemic, a lot of Australians are looking for a different lifestyle – one built around more space and less stress. While this has long been a trend for retiring Australians, we’re seeing a lot of people move at an earlier stage in life, often with young families. A lot of these new arrivals have been able to take advantage of flexible working during the pandemic and find they don’t have to be in the office five days a week.

In fact, the ABS is reporting that over the past 12 months more people have left capital cities for the country than at any time in recent history, with 11,200 people leaving cities in the capital cities in the September 2020 quarter.

But the demand for houses in our area isn’t all coming from people moving here. We’re seeing a lot of existing locals looking to move into a larger home that gives them a more comfortable lifestyle. This is combining with the flight from the cities to create demand for houses as well as for acreages in our area.

The standout location for 2021

Generally, Singleton and the Hunter Valley are a little different to many parts of regional Australia because this isn’t simply an area people come to only looking for a treechange. The local economy is strong and increasingly diverse. We’re also close enough to Newcastle and Sydney for people to commute when needed and we’re seeing a lot of people who work from home coming into our local area.

It is these factors and others that led Money Magazine to nominate the Hunter Valley as its stand out property location for NSW in 2021. The magazine observed that our region wasn’t just a desirable lifestyle location, it was also a vibrant economy. It is also likely to grow rapidly over the next little while as projects such as the Singleton Bypass and Hunter Gas Pipeline click into gear and create more local jobs.

“The region is a natural fit for the two trends expected to dominate 2021, the infrastructure-led property boom and the exodus to an affordable lifestyle,” it noted. “Centres such as Maitland, Singleton and Muswellbrook are expected to thrive.”

Other factors to continue

At the same time as the Hunter Valley experiences these positives, the broader economic signs also look encouraging. Consumer and business confidence are up and unemployment is lower. This often gives people the confidence they need to make an offer on a new home. So do low-interest rates, and they have never been lower than right now. Importantly, the RBA has said it won’t raise them again until prices rise.

In our local area, first home buyers are always an important market segment and 2021 should be a good year for them too. The first homeowner grant and stamp duty concessions, as well as Commonwealth incentives such as the First Home Loan Deposit Scheme, have made it easier to get into the market for the first time.

We expect these factors will combine with the trends we’ve highlighted above to drive local prices higher over the coming year. If you’re interested in buying locally, it could pay to act before prices rise further still.

Want to know more about the state of the local market?

If you’d like to find out more about the state of play in the local property market contact One Agency Lindy Harris today.

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