Regional Australia has extended its lead over the capital cities, with dwelling values rising 3.2 per cent over the three months to January, compared with a 2.1 per cent increase across the combined capitals.
The result marks a clear shift in market momentum as affordability, renewed internal migration and competitive conditions direct more buyers towards regional areas.
Strong growth market
Cotality’s February Regional Market Update shows almost three in five of the country’s largest regional Significant Urban Areas (SUAs) recorded a faster pace of growth than the October reading, underscoring the breadth of the upswing.
Affordability remains a powerful driver of buyer behaviour. With capital city prices still near record highs and stock levels tight, many households are once again looking to regional Australia for greater value and liveability.
Regional Western Australia recorded the strongest uplift of any state, with values rising 6.1 per cent over the three months to January, up from 4.9 per cent previously. Albany (7.7 per cent), Kalgoorlie-Boulder (7.6 per cent) and Busselton (7.0 per cent) were standout performers, with Bunbury and Geraldton also exceeding the average rate of growth. In contrast, Broome (0.8 per cent) and Port Hedland (1.6 per cent) delivered comparatively softer results.
Wagga Wagga in NSW was the strongest individual performer across the country, posting an 8.1 per cent rise in values over the quarter.
Queensland and South Australia also recorded stronger conditions compared with October, led by Toowoomba, Bundaberg and Cairns for the former and Victor Harbor–Goolwa for the latter.
By comparison, growth was more subdued in New South Wales (2.5 per cent) and Victoria (2.3 per cent), with both states showing little change from the previous quarter. These were also the only states to record localised declines, including Bowral–Mittagong (-2.1 per cent), Warrnambool (-0.4 per cent) and Batemans Bay (-0.4 per cent).
Regional rents also on the up
Rents also rose faster than their city counterparts in the three months to January, with regional rents rising 1.6 per cent, slightly ahead of the capital cities (1.4 per cent).
Over the past five years, regional rents have risen 41.9 per cent, far outpacing wage growth of 17.5 per cent and reinforcing mounting affordability pressures.
Only four of the 50 largest regional markets recorded a fall in rents in the quarter, led by Hervey Bay (-0.5 per cent). Tasmania saw some of the fastest increases, with Devonport (5.0 per cent), Launceston (4.3 per cent) and Burnie-Somerset (3.2 per cent) all posting strong gains.
Albany (16.9 per cent) and Devonport (11.8 per cent) led annual rental growth.
