THE AFFORDABLE AUSTRALIAN REGIONS BUCKING THE PRICE FALL TREND
More than ever, it pays to tread carefully when choosing an investment property in an uneven market
2 min
It’s easy to think that Australian house prices are on a downward spiral, as interest rates edge closer to the 4 percent mark.
And while the nation’s most expensive cities of Sydney, Melbourne and Canberra have experienced drops in values – Sydney is down 10.8 percent since February 2022 – it’s not the same story across the country, said Ray White chief economist Nerida Conisbee.
“Some markets are less sensitive to interest rates. Sydney, Melbourne and Canberra are our most expensive cities and as a result are far more sensitive to the cost of debt,” she said. “Sydney house prices have now fallen by 10.8 per cent from their peak in February 2022. Compare that with Adelaide where the median is half that of Sydney – prices are down only 1.8 percent from the peak.”
It’s a similar result in the resource capitals of Perth and Darwin.
Research by Ray White reveals that some city and regional areas are continuing to increase in value, although it’s very much on a case-by-case basis. Potential regional property investors would do well to tread carefully before purchase.
Parts of Adelaide such as Playford, the Adelaide Hills and Salisbury have seen steady increases in house values over the past year, while in Brisbane, more affordable suburbs such as the Ipswich Hinterland, Beaudesert, Beenleigh and the Caboolture Hinterland have performed well.
The Queensland regional centre of Bundaberg experienced the highest regional growth in house values during the 12 months to January 2023, with median values up from $394,436 to $422,559, or $28,123. Other parts of Queensland, including Cairns north, the Whitsundays and Maryborough also saw values go up.
Some regions of South Australia proved more resilient as well, with house values increasing on the Limestone Coast, in the Murray and Mallee and Kangaroo Island. The Upper Hunter saw the strongest growth in NSW regional house prices, up from $414,034 to $437,108.
“At a small area level, the difference between what’s happening is even more stark,” Ms Conisbee said. “The capital city areas still recording year-on-year increases are all relatively affordable suburbs in Brisbane and Adelaide. Both of these cities recorded net interstate migration during the pandemic. Most people that moved during this time initially rented and a shift from renter to buyer is likely to be in part driving price growth.
“At a regional level, the areas seeing growth tend to be more affordable holiday destinations, as well as towns that are benefiting from strong agricultural and mining conditions.”
Early indications from several big regional real-estate boards suggest March was overall another down month.
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Early indications from several big regional real-estate boards suggest March was overall another down month.
3 minOTTAWA–The nascent recovery in Canada’s housing market has become a casualty of the trade dispute with the U.S.
The latest national home-resale data are due out Tuesday, but early indications from several big regional real-estate boards suggest March was overall another down month as many prospective buyers exercised caution.
The recent weakness in home sales has dimmed the previously brighter outlook for the property market coming into 2025, when buyers were encouraged by the Bank of Canada’s aggressive interest-rate cuts.
“The chills the U.S. trade war has sent through participants in the housing market are getting frostier,” said Robert Hogue , assistant chief economist at Royal Bank of Canada.
Hogue said resales are down materially in a number of markets two months running, and home prices in several markets are coming under pressure as inventories rise. And although Canada was spared additional levies when President Trump unveiled so-called reciprocal tariffs on dozens of countries earlier this month, no meaningful rebound is likely so long as trade uncertainty lingers, he said.
Home buyers in Toronto, Canada’s most populous city and the country’s financial hub, aren’t turning up for the usual spring pickup in property-market activity.
Sales in the Greater Toronto Area slumped 23.1% in March from a year earlier, as new listings for the region jumped close to 29%, according to the Toronto Regional Real Estate Board. That marked the worst month of resales since 1998.
The board’s chief information officer, Jason Mercer , said many potential home buyers were likely taking a wait-and-see approach given the economic worries as well as a pending federal election. “Homebuyers need to feel their employment situation is solid before committing to monthly mortgage payments over the long term,” he said, adding that ownership has become more affordable and prices in the area fell about 3.8% year on year in March.
Uncertainty is also weighing on the housing market in Calgary, the biggest city in oil-rich Alberta. The city’s real-estate board said realtors reported a 19% drop in sales of existing homes from last year, with a similar trend of improving supply and a sharp increase in the average number of days that homes were on the market.
On the West Coast, home sales registered in the metro Vancouver area of British Columbia were the lowest for March since 2019, falling 13.4% on a year earlier and coming in close to 37% below the 10-year seasonal average, while active listings continued to rise.
There are some areas of resilience. The Quebec Professional Association of Real Estate Brokers said total sales in the province were up 9% year on year in March. Still, RBC’s Hogue estimated Montreal sales in March were down about 15% from December seasonally adjusted, effectively rolling back the advance since the end of last summer.
The most recent national data for the country, from the Canadian Real Estate Association, showed resales dropped 9.8% month over month in February, when homebuyers may also have been put off by harsh winter storms in parts of the country. That marked the sharpest fall since May 2022 and brought the level of sales to their lowest level since November 2023, snapping signs that activity had been picking up in recent months.
Rishi Sondhi , an economist at Toronto-Dominion Bank, in a recent report estimated the country was tracking toward a double-digit quarterly decline in Canadian home sales and a mid-single-digit drop in Canadian average home prices for the first three months of 2025. That is much weaker than a pre-Trump inauguration forecast made in December that projected a loosening in federal mortgage rules, lower interest rates and continued economic growth would fuel a modest gain in sales and prices.
Central-bank officials are set to decide Wednesday on monetary policy, but they have signaled a cautious approach to rates as they balance the prospect of tariffs stoking price pressures against the likelihood that they will dampen demand and weigh on the economy. That could mean the Bank of Canada will pause after seven straight cuts to its policy rate.
Housing is a hot topic for party leaders campaigning ahead of the April 28 election, with both the incumbent Liberal Party and opposition Conservatives proposing tax cuts and incentives to encourage buyers and builders.
The outlook for new homes has also dimmed with the tariff threat. The value of residential-building permits issued in February fell 2.9% from a month prior, adding to a retreat in January that took back some of the surge in intentions in the final month of last year, Statistics Canada data last week showed.
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