So-called “lifestyle” suburbs in regional NSW that were popular during the early Covid pandemic have recorded some of the biggest property price falls this year.
Over the past 18 months, house prices in regional NSW have fallen 38 per cent with the state seeing the sharpest drops across Australia.
The PropTrack Regional Australia 2022 Report found that popular tree-change and sea-change markets that boomed during successive Covid lockdowns were the first to see prices fall as Australia began to recover from the pandemic and interest rates rose.
Despite the recent price drops, the report found that demand for the more affordable areas is still more than double pre-pandemic levels – with some areas seeing 20 per cent growth in the number of highly engaged buyers viewing listings online.
The report collated a list of areas and regions where prices have slipped the most across Australia, with seven of the top 10 regions in regional NSW.
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PropTrack senior economist and report author Eleanor Creagh said the stock of properties for sale remained limited, down 37 per cent on pre-pandemic levels.
“Throughout 2020 and 2021, we saw the pandemic, multiple lockdowns and more time spent at home lead many to reassess their housing wants and needs,” Ms Creagh said.
“Housing markets in regional Australia thrived as people sought more space and more affordable homes. Remote working opportunities and preference shifts drove strong population growth in regional areas at the expense of the capitals, predominantly Sydney and Melbourne.”
The South Coast hamlet of Sussex Inlet experienced the largest drop in sales volumes, falling 63 per cent since October 2022.
The Illawarra suburb of Tulimbar was close behind, seeing a 57 per cent decrease in the same time period,
While regional affordability has eroded as a result of price increases in recent months, areas in regional NSW have closed the value gap between rural suburbs and those in Sydney.
Demand activity on realestate.com.au in regional areas has eased and remains high, with population continuing to flow from capital cities to the regions.
Regional NSW ranks highly for buyers looking for a place to live, accounting for a 24 per cent share of interstate searches.
“Regional markets are likely to continue to exhibit a slower pace of price falls compared to capital cities. They remain buoyed by shifting lifestyle priorities, migration trends and affordability advantages that are still in play.”
“In addition, conditions remain tougher for regional buyers, with the number of properties listed for sale still well below pre-pandemic levels, which is also seeing some markets remain more competitive and shielding home values.”
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Story Credit: news.com.au