Top 10 Regional Growth Areas For 2021
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Top 10 Regional Growth Areas For 2021

Investors and homeowners are looking beyond the Australian capital cities.

By Terry Christodoulou
Fri, Mar 26, 2021 12:04pmGrey Clock < 1 min

Eight of Australia’s top 10 regional growth areas will see the value of development exceed the billion-dollar mark this year as buyers look beyond Australia’s capital cities.

The PRD Stand Out regions report ranked locations around Australia according to the median price affordability alongside indicators for property investment, local employment growth and sustainable economic futures.

Coastal locations of The Whistdundays (QLD), Port Stephens (VIC) and Greater Bendigo (VIC) fared best in the report as places for residential development, with a rental vacancy of 0.4-1.5 per cent at the end of 2020 compared to 1.8-4.7 per cent in city areas according to the report.

Other top performing regions included Mackay (QLD), Toowoomba (QLD), Greater Hume Region (NSW), Federation (NSW), Greater Geelong (VIC), Warrnambool (VIC) and Circular Head (TAS). 

While residential potential in these regions is strong, commercial infrastructure and industrial projects make up a large portion of development set to start in 2021 including solar farms, new commercial hubs and transport links.

“Regional areas have become the most attractive option throughout 2020, with evidence of buyers capitalising on lower median property prices,” the PRD Stand Out Regions report said.

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Amid looming rate rises, there are reasons to be cheerful as mortgage holders head into 2023

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Mortgage holders should brace themselves for more pain as the Reserve Bank of Australia board prepares to meet this afternoon for the first time this year.

Most economists and the major banks are predicting a rise of 25 basis points will be announced, although the Commonwealth Bank suggested yesterday that the RBA may take the unusual step of a 40 basis point rise to bring the interest rate up to a more conventional 3.5 percent. This could present the RBA with the chance to put further rate rises on hold for the next few months as it assesses the impact of tightening monetary policy on the economy.

The decision by the RBA board to make consecutive rate rises since April last year is an attempt to wrestle inflation down to a more manageable 3 or 4 percent. The Australian Bureau of Statistics reports that the inflation rate rose to 7.8 percent over the 2022 December quarter, the highest it has been since 1990, reflected in higher prices for food, fuel and construction.

Higher interest rates have coincided with falling home values, which Ray White chief economist Nerida Conisbee says are down 6.1 percent in capital cities since peaking in March 2022. The pain has been greatest in Sydney, where prices have dropped 10.8 percent since February last year. Melbourne and Canberra recorded similar, albeit smaller falls, while capitals like Adelaide, which saw property prices fall 1.8 percent, are less affected.

Although prices may continue to decline, Ms Conisbee (below) said there are signs the pace is slowing and that inflation has peaked.

“December inflation came in at 7.8 per cent with construction, travel and electricity costs being the biggest drivers. It is likely that we are now at peak,” Ms Conisbee said. 

“Many of the drivers of high prices are starting to be resolved. Shipping costs are now down almost 90 per cent from their October 2021 peak (as measured by the Baltic Dry Index), while crude oil prices have almost halved from March 2022. China is back open and international migration has started up again. 

“Even construction costs look like they are close to plateau. Importantly, US inflation has pulled back from its peak of 9.1 per cent in June to 6.5 per cent in December, with many of the drivers of inflation in this country similar to Australia.”

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