John McGrath - East Coast's Regional Boom Has Begun
People are moving out of Sydney and Melbourne like never before, with the pandemic inspiring a wave of seachanging and treechanging amongst families, as well as earlier retirement for senior Australians.
Latest Australian Bureau of Statistics figures show the largest quarterly population exodus from the combined capital cities since records began back in 2001, with a net loss of -11,200 people in the September 2020 quarter, overwhelmingly led by Sydney and Melbourne.
The biggest groups leaving our two most expensive markets are young families (25-44 year olds), closely followed by retirees and older families (45-64 year olds).
A huge proportion (about half) of these city escapees chose to relocate within the same state, with regional NSW experiencing a net internal migration gain that was 228% up year-on-year; with regional Victoria up 123%.
This choice isn’t surprising given the frequency of state border lockdowns throughout 2020. It was simply easier to remain within the same state. Plus, people who leave cities for the first time tend to favour areas within driving distance, so they can stay in touch with family and commute for work.
However, there was some cross-border movement in 2020, with Brisbane and regional Queensland especially popular.
The biggest category of internal migration gains for Brisbane was young families (25-44 year olds) attracted to the city for its employment opportunities and cheaper housing.
Regional Queensland attracted young families and retirees and older families in almost equal measure, with our agents on the ground telling us of continually swelling demand throughout 2020 in hot spots like the Gold Coast, Sunshine Coast and Noosa.
The Sunshine State was already dominating national internal migration trends before the pandemic and the virus turbocharged it. The biggest factor has been a massive structural change in the workplace, with more people able to work from home.
This has prompted a lifestyle re-think among southern city workers. Queensland offers better weather, a great lifestyle and significantly cheaper housing, so why wouldn’t they head north?
It’s clear from CoreLogic’s new quarterly Regional Market Update that many areas are benefitting from these population shifts, with a very positive flow-on effect to local property values.
In the year to January 2021, the No 1 growth area nationally for houses was the Richmond-Tweed on the NSW North Coast (incorporating Byron Bay and Ballina) where house prices rose 12.6%. No 1 for apartments was the NSW Southern Highlands and Shoalhaven, where values gained 17.9%.
Let’s take a look at the price growth in the East Coast’s key regional markets over the past year.
- Richmond-Tweed 12.6% (houses) 7.5% (apartments)
- Newcastle & Lake Macquarie 11.2% (houses) 6% (apartments)
- Capital Region 11% (houses) 10.1% (apartments)
- Southern Highlands & Shoalhaven 10.9% (houses) 17.9% (apartments)
- Illawarra 10.3% (houses) 5.1% (apartments)
- Mid North Coast 8% (houses) 3.7% (apartments)
- Sunshine Coast 9.8% (houses) 7.6% (apartments)
- Gold Coast 8.9% (houses) 7.5% (apartments)
- Central Queensland 7.4% (houses) 3.3% (apartments)
- Townsville 6.6% (houses) 9.1% (apartments)
- Toowoomba 4.9% (houses) 2.7% (apartments)
- Ballarat 7% (houses) 5% (apartments)
- Latrobe-Gippsland 6.8% (houses) 7.1% (apartments)
- Geelong 5.3% (houses) 6.9% (apartments)
The regional relocation trend is only going to get stronger, especially if state borders remain open. Now that vaccinations are underway, further snap border shutdowns in response to outbreaks are less likely, with ‘ring vaccination’ (more local jabs) the preferred containment strategy.
This would facilitate further people movement from the cities to the regionals; and in terms of Queensland, it could create a boom market that is long overdue, particularly in the South-East.
The views expressed in this article are an opinion only and readers should rely on their independent advice in relation to such matters.
This article originally appeared in The Real Estate Conversation (March 1, 2021)
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