Overview
- Regional dwelling values rose 3.3% in the three months to April, significantly outpacing the 1.1% increase recorded across the combined capitals.
- Affordability and internal migration remain key drivers of regional demand, even as broader market momentum begins to ease.
- Western Australia continues to dominate growth, with Busselton (7.5%) and Albany (7.2%) recording the strongest quarterly gains nationally
Regional Australia has extended its performance lead over the capital cities, with dwelling values rising 3.3% over the three months to April, compared with a more modest 1.1% increase across the combined capitals.
The latest data from Cotality’s Regional Market Update reveals that while market momentum has shifted nationally, the easing across regional Australia has been far less severe than in the capital cities.
Three in five of the country’s 50 largest regional Significant Urban Areas (SUAs) recorded a slower pace of growth this quarter, yet the regions continue to hold their lead as affordability drives buyer behavior.
Gerard Burg, Cotality’s Head of Research for Australia, said the results underscore the resilience of regional markets in the face of broader economic headwinds.
“We are seeing a clear loss of momentum at the national level, but regional markets are proving more resilient than their capital city counterparts,” Mr Burg said.
“Affordability remains a central driver, with internal migration patterns continuing to favour regional areas where buyers can find greater value and a different pace of life.”
Western Australia leads national growth surge
Regional Western Australia remains the standout performer, with values rising 5.9% over the three months to April, up from 5.6% in the previous quarter. Busselton recorded the strongest quarterly growth of any SUA nationally at 7.5%, followed closely by Albany (7.2%), Geraldton (6.8%), and Bunbury (5.8%).
“The strength in southwest WA is particularly notable,” Mr Burg added.
“Busselton’s growth is occurring despite it having a higher median value than Greater Perth, which suggests this performance is being driven by more than just affordability. We’re seeing a significant spillover of demand from the Perth market into nearby regional hubs.”
Strong conditions were also evident in Queensland, led by Townsville, Maryborough, and Toowoomba, while Tasmania saw renewed strength driven by Burnie-Somerset and Launceston. Conversely, parts of New South Wales and Victoria saw localized declines, with Bowral-Mittagong falling 1.2% and Albury-Wodonga easing 0.2%.
Selling conditions tighten in the West
The imbalance between supply and demand remains most acute in WA and Queensland. Selling times in these states are the fastest in the country, with median time on market at 17 and 24 days respectively. Albany recorded the shortest selling time nationally at just 10 days, followed by Busselton at 12 days.
In contrast, New South Wales markets recorded some of the weakest selling conditions. Batemans Bay (66.5 days) and Bowral-Mittagong (65 days) had the longest median time on market, reflecting a looser supply-demand balance in those localities.
Regional rents remain under pressure
Regional rental growth marginally lagged the capital cities this quarter, rising 1.8% compared with 2.1% in the capitals. However, the regional vacancy rate remains incredibly tight at 1.9%, up only slightly from 1.8% in January.
“Rental affordability continues to be a challenge for regional residents,” Mr Burg said.
“With vacancy rates as low as 0.4% in markets like Lismore and 1.0% in places like Geraldton and Albany, the stock of available homes simply isn't keeping up with the demand from internal migration.”
Gross rental yields remained stable at 4.2% in April, consistently higher than the 3.6% recorded across the combined capital cities. Kalgoorlie-Boulder remains the highest-yielding major regional market at 8.1%.
