Property growth markets are the majority despite claims otherwise: Hotspotting's Terry Ryder

EXPERT OBSERVER

Australia has many growth markets at the moment. Jurisdictions where prices are growing outnumber those where they’re falling.

Didn’t know that? Here’s the problem.

Most of our major media emanates from Melbourne and Sydney. Writers there are obsessed with themselves and have little awareness of the 17 million Australians who don’t live in the two biggest cities. They tend to assume that events in Sydney describe the whole nation. If Sydney’s booming, they write about the national property boom. If Melbourne - otherwise known as Corona Country, home of the Dan-demic – is falling, the coverage suggests a national market slump.

That’s never true and it’s certainly not true right now. Regional Australia is pumping and we’re not hearing too much about it.

Let’s look at the latest price data from Domain, which focuses on the figures for the June Quarter.

In annual terms, six of the eight capital cities have house prices higher than a year ago. Remarkable, really. The exceptions are Perth and Darwin.

In the June Quarter, Canberra and Hobart recorded increases while Adelaide was essentially no change. Sydney, Brisbane, Perth and Darwin all fell about 2% and Melbourne around 3%. Those figures generated nationwide headlines that prices were falling everywhere.

It’s important to note that other sources, like SQM Research and CoreLogic, have different results. Media never acknowledges that the various sources come up with different outcomes on prices – they’re too busy sensationalizing the negatives in any set of figures.

But CoreLogic’s latest figures record growth in house prices in the June Quarter in Adelaide, Hobart, Canberra and Darwin and no change in Brisbane. In other words, CoreLogic’s figures are more positive than those from Domain.

Returning to the Domain data, the results for regional Australia are considerably more bullish than those for capital city Australia. For the June Quarter it records price rises in New South Wales, Victoria, South Australia and Tasmania – while in annual terms, there are increases in Tasmania (12%), Victoria (7%), NSW (6%), South Australia (4%), the Northern Territory (4%) and Western Australia (2%). Queensland was the only regional jurisdiction to record an annual decrease (less than 1%).

The CoreLogic figures for regional Australia in the June Quarter recorded house price rises in NSW, Victoria, South Australia, Tasmania and the Northern Territory.

Markets in many regional areas are pumping. Regional cities and towns have generally experienced few cases of Covid-19 – and some have had zero cases. Apart from those heavily reliant on international tourism, local economies are travelling pretty well and some are thriving, because of the components of the local employment sector. Agriculture, viticulture, mining, medical services and food services are all sectors that have done fairly well or very well amid the virus shemozzle.

There is also the trend I call “the exodus to affordable lifestyle”. This was already well under way, with people relocating from the big cities to sea change and hill change locations within 1-2 hours of the capital. The virus shutdown phase has enhanced this significant trend. Working remotely doesn’t suit everyone but there are many for whom it works to work at home.

First-home buyers boosted by multiple government incentives and investors seeking affordability and yield, as well as solid growth prospects, are also helping to drive regional markets.

Near Melbourne, markets like the LGAs of Baw Baw (10%), Golden Plains (16%) and Central Goldfields (11%) have all recorded double-digit annual rises, according to the Domain data.

Near Hobart, municipalities such as Brighton and Huon Valley have risen 20% in 12 months, but growth markets can be found right across regional Tasmania.

In Queensland, the regional markets with prolific one-year increases tend to be resources-related locations, some of them rising from a low base after years of decline.

There’s plenty of growth happening out there in Australia, beyond the boundaries of Melbourne and Sydney.

Terry Ryder is the founder of hotspotting.com.au
ryder@hotspotting.com.au
twitter.com/hotspotting