• The median Regional house and unit prices continued to increase and both reaching all-time highs as at March 2022;
• The vacancy rate for Regional Victoria remains very tight at 1.4% as its population continues to increase;
• Rents continue to grow for Regional dwellings with both houses and apartments haven risen to all-time highs, outperforming the Melbourne metropolitan area.

Victorian Regional Residential Market Summary

While Melbourne’s population decreased by 60,500 over the year with many relocating to the regions, demand for housing continues to outstrip supply resulting in solid price growth. Both house prices and apartment prices of Regional Victoria reached all-time highs as at March 2022. Regional house prices outperformed apartment prices over the year increasing the price spread between houses and prices to a record level.

Prices

With demand outstripping supply, Victorian Regional housing prices continue to gather momentum with both house prices and apartment prices outperforming the gains achieved in the Melbourne metropolitan area. Over the year to March 2022, the median Regional house price increased by 20% to $658,500 with the median Regional apartment price having increased by 12% to $548,000 over the same period. In comparison, Metropolitan median house prices increased by 17% over the year with apartment median prices having risen by 6% over year to March 2022. According to the REIV, median house prices of the regional cities of Geelong ($786,000), Ballarat ($550,000) and Bendigo ($555,000) have all once again reached all-time highs as at March 2022 for the third consecutive year. Urban Property Australia expects that the Regional housing markets will outperform the metropolitan housing market in the short term underpinned by the trend of people relocating from the metropolitan area with employees increasingly seeking to incorporate an element of remote working as part of their working week.

Regional Dwelling Prices

Demand / Vacancy

According to the ABS, Melbourne metropolitan’s population declined by 60,500 over the year to June 2021 with 33,500 Melburnians moving to the regions. Geelong and Ballarat experienced the biggest gain in population which has also led to employment growth. The pandemic and working from home has made a regional move more possible for those in capital city-based jobs, with the flexibility of work never been so recognised as previously considered.

According to the REIV, as at March 2022, the vacancy rate for Regional Victoria remains very tight at 1.4% (slightly higher than the rate of 1.0% recorded a year earlier). The vacancy rates of the major Regional Cities also remain very low, led by Ballarat (1.2%) followed by Geelong (1.7%) with Bendigo at 2.0% (which are all significantly below the metropolitan average of 5.0%).

Residential Vacancy by Region

Rents

Similar to dwelling values, housing rental levels in the Regional markets have continued to increase in contrast to the metropolitan area. According to the REIV, Regional Victorian weekly rental levels for both houses and apartments have risen to all-time highs. Over the year to March 2022, the weekly median rent for houses in Regional Victorian rose to $420 per week, up from $390 per week a year earlier. Likewise, the weekly median rent for units rose to $350 per week, up from $320 per week a year earlier. By regional city, Bendigo outperformed both Geelong and Ballarat with the weekly median rent for houses up 14% to $420 as at March 2022. In comparison weekly median rents for houses in Ballarat increased by 3% to $380 with rents for Geelong houses increasing by 2% to $450 per week as at March 2022.

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