• Victorian Regional housing prices have declined for two consecutive quarters for the first time since 2014;
• The vacancy rate for Regional Victoria remains very tight at 2.0% as its population continues to increase;
• Regional Victorian weekly rental levels for both houses and units have risen to all-time highs with houses outperforming apartments over the past year.

Victorian Regional Residential Market Summary

Although prices have not fallen to the extent of those in the Melbourne metropolitan area, Victorian Regional housing prices have declined for two consecutive quarters for the first time since 2014. With demand surpassing availability, the vacancy rate for Regional Victoria remains very tight at 2.0% with the residential vacancy rate of Ballarat even lower at 1.5%.

Prices

Although prices have not fallen to the extent of those in the Melbourne metropolitan area, Victorian Regional housing prices have declined for two consecutive quarters for the first time since 2014. While over the year to September 2022, the median Regional house price increased by 5% to $617,900, over the quarter Regional house prices fell by 4%. Similarly, while the median Regional unit price increased by 2% to $523,000 over the year, in the September 2022 quarter, prices declined by 3%. According to the REIV, median house prices of the regional cities of Geelong ($795,000), Ballarat ($580,000) and Bendigo ($580,000) have all once again reached all-time highs as at September 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 (f)

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 September 2022, the vacancy rate for Regional Victoria remains very tight at 2.0% (higher than the rate of 1.3% recorded a year earlier). The vacancy rates of the major Regional Cities also remain very low, led by Ballarat (1.5%) followed by Bendigo at 2.3% and Geelong (3.2%) (which are all below the metropolitan average of 3.2%).

Residential Vacancy by Region

Rents

Similar to dwelling values, housing rental levels in the Regional markets have continued to increase. According to the REIV, Regional Victorian weekly rental levels for both houses and units have risen to all-time highs. Over the year to September 2022, the weekly median rent for houses in Regional Victorian rose to $430 per week, up from $400 per week a year earlier. Likewise, the weekly median rent for units rose to $350 per week, up from $328 per week a year earlier. By regional city, Bendigo outperformed both Geelong and Ballarat with the weekly median rent for houses up 11% to $420 as at September 2022. In comparison weekly median rents for houses in Geelong increased by 4% to $383 with rents for Bendigo houses increasing by 3% to $460 per week as at September 2022.

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