The impacts of the COVID-19 outbreak on the housing market appear to have sparked a shift in the preference of Australian homebuyers and investors, who are now increasingly looking at regional markets, according to market experts.
Cate Bakos, president of the Real Estate Buyers Agents Association (REBAA), said properties in many regional locations are recording an increase in demand and shorter days-on-market amid the COVID-19 pandemic.
"For investors who have witnessed some particularly strong regional city capital growth rates, the added bonus of typically stronger rental yields has presented an attractive option for those who favour a more balanced portfolio," she said.
Bakos said regional markets provide an opportunity for homebuyers to consider changing their lifestyles. She said the trend is popular amongst young families, relocating workers, and retirees who are looking to optimise their superannuation savings.
"Be mindful that if you do have to commute to a major city for work, whether it be one day per week or five days per week, that you can tolerate the commute journey and all that goes with the extended travel time," she said.
Before buyers even jump in on the trend, Bakos said it is important to consider buying regional homes with resale ability.
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"Don't buy a property that's on the main road, or is too odd or quirky, buy something that's popular with the locals," she said.
Simon Pressley, head of research at Propertyology, said this trend has already been apparent over the past few years. In fact, five of the eight capital cities in Australia recorded a decline in population from internal migration last year, with Brisbane and Hobart gaining the most.
"The official data also shows that most of Australia's best-performed property markets over the last five years were spread throughout regional Australia, not in the capital cities," he said.
Matt Ward, a local agent from Aspect Buyers Agency in New South Wales, said buyers are interested in "rural lifestyle blocks" closer to larger regional centres.
"We're seeing a lot of new entrants into the market as more people realise that the need for space, a side income and somewhere to escape to on the weekend can all be met in the one property," he said.
Ward said one factor attracting buyers to regional areas is the skills shortage in larger regional cities. Furthermore, Ward said buying a property in rural areas and farms allows buyers to grow their own food.
"The COVID-19 situation brought to people's attention the issue of food security and their inability to grow their own, so demand for properties with this potential have remained keenly sought after," he said.
Richard Evans, an agent from Fortune Property Finder, said regional areas like Newcastle, the Hunter Valley, and Lake Macquarie have received increased interest from potential buyers amid the COVID-19.
"Whether it is the appeal of a seaside city apartment, character cottage with relaxing permaculture garden and art studio, or an investor chasing higher yields, regional cities and surrounds offer a great mix of opportunities for those who are prepared and enlist the best local support available," he said.
