3 regional cities to watch in 2021
3 regional cities to watch in 2021
National real estate agency Raine & Horne is expecting capital growth of up to 10 per cent in key regional markets in 2021, revealing three cities it says are poised for solid gains.
Raine & Horne executive chairman Angus Raine said the “property planets have aligned” for three regional cities in particular - Bathurst in New South Wales, Toowoomba in Queensland, and Mandurah in Western Australia.
“Interest rates are at all-time lows, and more city slickers have identified they don’t have to work 9-5 in a CBD anymore,” Mr Raine said.
“In nine months, COVID-19 has done more to speed up decentralisation than a hundred years of government policy and planning.”
Mr Raine said many buyers had realised there was great value in regional locations, without having to sacrifice access to good schools, medical infrastructure and employment opportunities.
In Bathurst, local agent Michelle Mackay said 5 per cent capital growth growth was likely this year, with Sydney buyers in particular interested in the home of Australia's most famous motor race.
The co-principal of Raine & Horne Bathurst said a record 41 properties were sold over a four week period in late November and early December, while 14 properties worth more than $1 million were sold in 2020.
Ms Mackay said the agency would typically sell just three homes worth more than $1 million in any calendar year.
“There are lots of Sydney first and second home buyers moving here who will continue to work for city-based firms as well as some investors who recognise the appeal of Bathurst affordability and rental yields,” Ms Mackay said.
“Workers are selling up in Sydney and buying modern four-bedroom houses with double lockup garages on 900 square metres in Bathurst for $600,000.
“There are multiple buyers for every property and as a result values in Bathurst rose 5 to 6 per cent in 2020.”
Ms Mackay said the only challenge for Bathurst achieving more than 5 per cent growth in 2021 would be a lack of stock.
“If you’re considering a sale then 2021 should produce some excellent results for vendors,” she said.
In Queensland, the Darling Downs city of Toowoomba, west of Brisbane, is set for one of its best years in several decades, according to Raine & Horne Toowoomba principal Andrew Lynch.
Mr Lynch said a combination of affordability, infrastructure and liveability placed Toowoomba at top of mind for many buyers seeking a tree change.
“Everyone wants to move to Toowoomba because you have real estate affordability, a full suite of services, jobs and great schools,” Mr Lynch said.
“Thanks to COVID-19 putting Toowoomba up in lights, I can see no reason why we can’t achieve average growth of 10 per cent in 2021.
“Families can get bang for their buck on a home, which then gives them more money to spend on education at one of this town’s many excellent schools such as Toowoomba Grammar that produced Australian Wallaby Jason Little and broadcaster Alan Jones, Glennie Anglican Girls School, Fairholme College for Girls, Downlands College where rugby union great Tim Horan went to school and many more.”
Mr Lynch said investors were also converging on Toowoomba due to potential jobs growth across a diverse local economy.
“Also, the inland rail link between Melbourne and Brisbane that will run through Toowoomba is expected to bring many thousands of extra workers and boost gross regional product, which is all good news for real estate values long-term,” he said.
“It helps that investors can achieve yields as high as 6 per cent on the western side of Toowoomba and we have just 0.5 per cent vacancy rates.
“Meanwhile, weekly rents are also going up.”
Over in the west, Raine & Horne Mandurah principal Peter Vetten said the coastal canal enclave of Mandurah recorded a strong finish to 2020.
Mr Vetten said retirees and resources sector workers sought value in Mandurah in 2020, selling homes worth between $700,000 and $800,000 and shifting to lower value lifestyle oriented properties.
While prices were largely steady in 2020, Mr Vetten said he was expecting growth of around 5 per cent this year.
“Because of border closures, mining companies now prefer their employees to live in Western Australia rather than fly in and fly out as many did throughout the last resources boom between 2003 and 2013,” Mr Vetten said.
“With the demand from the mining industry workers for rentals, we are now in a situation where we have record low vacancies, which is discouraging long-term investors from selling.
“This lack of turnover is contributing to a shortage of listings and ultimately we feel it will result in price growth.”
“In a market where there are more buyers than sellers, those vendors in Mandurah who make a move to sell should enjoy excellent results in 2021.”