Australia's Secondary Cities Outshine Capitals in Property Growth
With the cost of living soaring, particularly in housing, Australians are increasingly seeking more affordable options. This trend has seen a dramatic shift in property investment, with secondary cities experiencing unprecedented growth over the past five years. Let's delve into the reasons behind this surge and explore the data.
The Rise of Secondary Cities
New data from CoreLogic reveals a compelling story. Secondary cities such as the Gold Coast, Geelong, and Newcastle have significantly outperformed their capital counterparts in terms of property value growth. This trend is primarily driven by the affordability crisis plaguing major cities. As Dr Diaswati Mardiasmo, chief economist at PRD real estate, aptly puts it, people are seeking more value for their money.
The increasing popularity of remote work has also contributed to the allure of regional centres. Dr Michael Fotheringham, managing director of the Australian Housing and Urban Research Institute, highlights the flexibility afforded by working from home, enabling people to seek out larger living spaces.
Property Value Comparison
To illustrate this trend, CoreLogic has compared dwelling value changes between capital and secondary cities over the past five years. While most secondary cities recorded higher growth, there were exceptions.
- New South Wales: Newcastle outperformed Sydney with a 50.7% increase compared to Sydney's 45.4%.
- Queensland: The Gold Coast's 76.9% growth dwarfed Brisbane's 63.4%.
- Victoria: Geelong's 32.2% growth lagged behind Melbourne's 24.8% due to COVID-19 impacts.
- South Australia: Adelaide's 61.5% growth slightly exceeded Mount Gambier's 58.8%.
- Northern Territory: Palmerston's 27.7% growth outpaced Darwin's 25.0%.
- Western Australia: Mandurah's 77.5% surge surpassed Perth's 61.6%.
- Tasmania: Launceston's 57.3% growth was notably higher than Hobart's 37.2%.
Dr. Fotheringham underscores the benefits of decentralisation, arguing that Australia's population concentration in a few major cities is unsustainable. Dr. Mardiasmo adds that regional centres now offer comparable lifestyles to metropolitan areas, making relocation a viable and attractive option.
The shift towards secondary cities represents a significant change in Australia's property landscape. As affordability pressures persist in capital cities, this trend is likely to continue. It's clear that regional centres are no longer just alternatives but are emerging as prime locations for both living and investing.
Source: ABC news
Date posted: June 4,2024