A new report has revealed regional house prices fell over the 2024 winter period with New South Wales particularly impacted by the drop.
The report, compiled by CoreLogic, showed that prices in some cities dropped as much as 4% between May and July in New South Wales and Victoria.
In contrast, it was the opposite in Western Australia and Queensland regional areas where prices continued to increase in strong conditions.
With major regional cities like Coffs Harbour and Wagga Wagga among those areas struggling, it painted an interesting disposition in traditionally strong property markets. So why did regional house prices fall in recent months?
Delving into the drop
One of the biggest takeaways from the report was the big drops across traditionally strong regional markets. This was true for areas in both New South Wales and Victoria.
The coastal tourist hub of Coffs Harbour saw the biggest drop nationwide where the average property price was now $767,064 – a 3.8% drop from values in April.
It was closely followed by Ballarat – Victoria’s biggest inland city – where house prices dropped by 3.4% to just $526,596.
Aside from Port Lincoln in South Australia, the biggest drops were in NSW or Victoria with 50% of the top 20 found in The First State.
CoreLogic, who compiled the report, cited that regional house prices fell not just because of the cost of living but also due to an increase in properties being put on the market.
The increase in choice drove a higher demand for prospective buyers to pay less with sellers looking to meet bids to secure a deal.
Where Regional House Prices Fell
Coffs Harbour
Sitting at the top of the list was Coffs Harbour – one of NSW’s premier tourist towns. Given its position as a tourist hub, the rapid fall in the Mid-North Coast capital might seem a shock. This comes as the city of 78,000 now sported an average house price of $767,064 – a drop of 3.8%.
This would come as a shock given that prices in the town peaked at a figure of $815,000 just as recently as March 2023. Despite this drop, the city has seen a steady rise in unit prices where prices have risen by 3% within the past year. All this comes in a region known as an all-year tourist hub and often attracts interest from both across Australia and overseas.
Orange
Orange was another of the major NSW regional hubs that felt the property pinch. The hub of the Central Tablelands saw property prices in the city drop by 3.1% to $615,504. This made it just one of three regional cities where regional house prices fell by more than 3% nationally during Q2 2024.
Orange finds itself very much at a crossroads thanks to its unique position. The town has experienced a population boom in the 21st century with over 40,000 calling Orange home – nearly a 30% increase over the past 20 years. The demand for new housing has seen figures drop as more and more people move to the area looking for a cheaper lifestyle.
Wagga Wagga
Halfway between Melbourne and Sydney, you would think that Wagga Wagga would be prime real estate for strong property prices. However, the city of 57,000 has seen prices drop in recent months to $518,829 – a drop of 2.6%.
It has been another region that has seen mass expansion in recent months with the population having climbed above the 50,000 milestone for the first time in the town’s history. With excellent links to major urban areas in New South Wales & Victoria, the continued growth and demand for housing has led to the drop with more opportunities to buy continuing to arise.
Forster-Tuncurry
It’s not just booming regions where property prices have dropped as seen in decreases across the Mid-Coast region. The twin towns of Forster-Tuncurry suffered a decrease where prices in the area fell by 2% to an average of $756,757.
One of the key hubs north of the Hunter Valley, the twin towns have been a real-estate paradise due to stunning ocean views and picturesque setting on the Coolongolook River estuary. Prices within Forster had hit well over $850,000 at the same point in 2023 proving that buyers have been hit hard by the cost-of-living crisis of 2024.
Kempsey
The town of Kempsey has often been a cheaper alternative to coastal hubs like Port Macquarie & Coffs Harbour. Yet this hasn’t saved the town from property prices falling either. The town of 15,000 has seen prices fall to $426,835 – a drop of 2% in recent months.
For Kempsey, seeing regional house prices fall comes for a town that suffers from its fair share of trouble. Its location on the Macleay River sees the town regularly flooded with significant floods in 2021 and 2022 still living fresh in the minds of residents. Despite this though, the region remains one of the best cheap alternatives for anyone looking to buy in the Mid-North Coast region.
Conclusion
Despite the drop in property prices across regional areas, it isn’t all down to buyers being put off buying homes. Instead, the increase in potential sales listings has given buyers more choice to find a home that meets their budget.
This means that towns that continue to experience population booms are still hot places to buy even if price statistics suggest otherwise. It’s why seeing regional house prices fall isn’t as alarming as it seems.
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