Pin-Pointing Australia’s Strongest Performing Property Markets

While some economists insist on telling us that Australian property prices are falling, the truth is that the collapse in prices predicted by these economists in March and the months that followed simply hasn’t occurred. In fact, there are many regions around Australia that are performing very well. Statistics show that of the eight capital cities and seven state regional markets that make up our fifteen major jurisdictions, eleven of these are experiencing higher house prices than at the beginning of 2020.

Mainstream media typically deduce that because the property market situations in both Melbourne and Sydney are in decline, then so too must be the rest of Australia, but that’s definitely not the case. We’re seeing many growth markets in regional Australia, and some smaller capital cities are also doing well. As an example, in spite of COVID-19, regional Queensland has maintained its high levels of well-performing markets, which is something that very few jurisdictions across Australia have managed to achieve. And the Sunshine Coast is proving to be one of the strongest economic stories in Australia, continually producing solid property market results

So while COVID-19 has brought Australia’s economy to a virtual standstill, and this does include property prices in some areas, there are other regions that are doing extremely well in spite of the pandemic. Perhaps the best example of this is the Sunshine Coast, which is a standout example of a thriving regional market.

There are many influencing factors behind why certain property markets are performing better than others. Some regions have local economies well established to survive the adverse effects of the COVID-19 shutdown. These are areas where the majority of jobs come from sectors typically hiring, rather than firing during this period. In addition, these are areas where spending on new infrastructure has never stopped. Some of these well-performing properly markets are in key regional centres and others are in smaller capital cities.

Investors are starting to believe the great growth potential in certain key areas, and First Home Buyers acting with government assistance are on the move. We’re also seeing a lot of activity from other types of owner-occupiers.

The key message for property investors today is that Australia has many growth markets right now. So let’s define the areas that have the right ingredients for growth and the key trends that are currently driving markets.

• 1: The exodus from cities to an affordable lifestyle has only been exacerbated by COVID-19 - it was already happening before the pandemic hit but the virus shutdown periods have encouraged many Australians to seek a better lifestyle with affordable housing. Many people leaving cities are now working from home.
• 2: Those cities that have COVID-19 under control are experiencing more activity, higher confidence, low vacancies, and a bolstered local property market.
• 3: Today, it’s the First Home Buyers that are the most active group in the market. This group is being driven by low interest rates and generous government assistance.
• 4: Vacancy rates are very low in many areas, which inevitably leads to rising rents. And as history shows, prices tend to follow.

The locations that are being impacted positively by the above trends are –

• 1: Cities like Perth, Adelaide, Darwin, Brisbane, Hobart, and Canberra have busy property markets because all cities have few COVID-19 issues. In the past few months Perth has seen a huge increase in sales activity; the Brisbane property market is steadily rising; Canberra has done very well inasmuch as it has been delivering price growth every month since March, but it’s Adelaide who has the most competitive property market in the country.
• 2: In cities like Perth, Brisbane, and Adelaide, First Home Buyers have been very active in the outer suburbs, but there’s also been First Home Buyer activity going on in the outer suburbs of other capital cities. This group of buyers are also active in regional towns and cities, particularly those that are close to big cities. For example, regional Queensland near Brisbane, regional New South Wales near Sydney, and regional Victoria near Melbourne.
• 3: The exodus from cities for those looking for a better and more affordable lifestyle is typically about regional Australia, with jurisdictions including regional Queensland near Brisbane, regional New South Wales near Sydney, and regional Victoria near Melbourne. Even Brisbane is on the receiving end of the ‘more affordable lifestyle’ group, with people leaving Sydney for a more affordable and less congested city lifestyle.
• 4: Rental vacancies are extremely low in Perth, Adelaide, Canberra, Brisbane, Darwin, and Hobart, and this includes key regional markets across the country. Today, in some areas we’re seeing vacancy lows of 1% and lower, and agencies are desperate for rental listings.

So, what does all the above mean. It means that, in some areas, all the above four trends are boosting sales. The locations that appear to be benefiting the most from these prevailing trends include:

• Brisbane
• Adelaide
• Regional New South Wales near Sydney
• Regional Victoria near Melbourne
• Regional Queensland near Brisbane.

Note: These are certainly the standout locations, but they’re not the only Australian property markets that are forging ahead.

Article source: https://www.propertyobserver.com.au/terry-ryder/116507-where-are-australia-s-standout-markets-hotspotting-s-terry-ryder.html