Australians move to regions seeking affordable housing
As Australians leave major cities in search of affordability, house prices in the regions are rising faster than in capital cities.
Regional house values rose 3.3 per cent in the three months to April, outpacing the 1.1 per cent rise in Australia’s capital cities, according to Cotality’s Regional Market Update published on Wednesday.
City slickers have been flocking to the country in waves for years, but since mid-2023 their motivations have changed.
“In the past it was more about coastal lifestyle markets,” Gerard Burg, Cotality’s head of Australian research, told AAP.
“This time, it seems to be more about affordability.”
Australians are now migrating to inland regional towns due to rising prices in cities.
This is evident in parts of regional WA, where values rose 5.9 per cent in the three months to April, up from 5.6 per cent in the previous quarter.
Perth’s housing supply has been particularly low in recent years.
“This has caused demand to spread across Perth’s borders and into surrounding areas,” Mr Burg said.
Similar stories are playing out in Tasmania, where prices are rising in Launceston and Burnie-Somerset, and in Queensland, where strong conditions are evident in Townsville and Toowoomba.
While rents continue to rise across the country, an increase of 1.8 percent was recorded in the regions, compared to 2.1 percent in the capital cities.
However, regional vacancy rates remain quite tight at 1.9 percent.
Construction costs have also risen significantly in recent months due to inflation challenges created by the US war in the Middle East, making it difficult to address the supply side of the housing crisis.
While migration to the regions could help towns struggling with declining populations, it could also further increase rents and house prices, placing additional burdens on the people living there.
Those moving out of cities may be supported by hybrid work styles and metropolitan wages, which may offer them benefits but impact housing affordability for others.
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