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Rush to the regions: which areas offer affordable house prices?
Thinking of moving to the country, or investing in a piece of regional property? The recent Roaring Regions report from PRD Real Estate’s research division lists the top 10 affordable regional areas for 2022.
It’s not a secret that Australia’s regional areas have seen something of a boom over the last few years, with many Australians from the capitals looking further afield for affordable housing or investment properties.
This has been partly attributed to work-from-home allowances that emerged due to Covid-19 allowing workers to consider property outside of capital cities while keeping the same jobs.
PRD Research selected its top ten regional areas based on these areas having:
- median house prices below the average loan for the state;
- positive median house price growth between 2020 and 2021;
- rental yields on-par or higher than those of the state’s capital city;
- vacancy rates on-par or lower than those of the state’s capital city;
- high estimated value of future project development, with a higher concentration of commercial and infrastructure projects to ensure a positive economic outlook, and;
- unemployment rate on-par or below the state average as of September quarter 2021.
“Excitingly, all chosen LGAs have a median house price of $550,000, which is half of Melbourne’s and a third of Sydney’s median house price in December Quarter 2021,” the report said.
Top affordable major regional areas
LGA | State | House median price (2021) | Land median price (2021) | Unit median price (2021) |
| Whitsunday | QLD | $400,000 | $188,000 | $300,000 |
| Mackay | QLD | $412,000 | $209,000 | $309,431 |
| Toowoomba | QLD | $430,000 | $205,000 | $310,000 |
| Upper Hunter | NSW | $373,000 | $130,000 | $231,000 |
| Wagga Wagga | NSW | $436,250 | $190,000 | $259,950 |
| Griffith City | NSW | $464,250 | $172,000 | $350,000 |
| Northern Grampians | VIC | $287,500 | $165,000 | $285,750 |
| Wodonga City | VIC | $450,000 | $172,000 | $288,250 |
| Greater Bendigo | VIC | $510,000 | $199,000 | $368,000 |
| Central Highlands | TAS | $250,000 | $66,775 | $180,000 |
Source: PRD Research
How can you buy a property in a regional area?
Australians who are curious about purchasing a home or an investment property in one of the areas highlighted by the PRD report have a range of potential options to consider. It’s important to compare home loans and make sure you make a choice that suits your personal goals and financial situation.
First home buyers who fulfil the eligibility criteria may be able to get support from the government to purchase in one of these regional areas, by using the First Home Loan Deposit Scheme (FHLDS) to buy with a deposit of just five per cent. The recent federal budget announced an expansion of the scheme, the Regional Home Guarantee, which is to add an extra 10,000 places for building or buying regional property as early as October 2022.
However, before signing up for the scheme, keep in mind that RateCity research recently found that first home buyers borrowing with low deposits could find themselves at risk of mortgage stress and even negative equity in the future if property values start declining following interest rates rises, which could start arriving as soon as June 2022, when the RBA is forecast to start raising the national cash rate. This could lead to around three in four borrowers having to cut back their spending to afford their home loans.
If you’re unsure of whether a regional property purchase may be the best choice for you, consider contacting a mortgage broker for advice on which loans and mortgage lenders may be able to help you achieve your financial goals.
Disclaimer
This article is over two years old, last updated on April 8, 2022. While RateCity makes best efforts to update every important article regularly, the information in this piece may not be as relevant as it once was. Alternatively, please consider checking recent home loans articles.
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