House prices across regional Victoria rose 6.7 per cent over the past year to a record median of $640,000 in the September quarter, according to fresh reporting by The Age, which offers subscription access. The result contrasted with Melbourne’s falling prices, as relative affordability and demand from investors supported several smaller regional markets.
The Glenelg local government area led the annual gains, rising by more than a quarter in 12 months, The Age reported from Domain’s House Price Report. Ararat, Gannawarra, Northern Grampians and Latrobe also recorded annual increases above 15 per cent. Ararat’s median house price rose almost 18 per cent over the year to $442,000.
Domain senior residential economist David Cannington told The Age that regional markets were still affected by higher mortgage rates, living costs, fuel prices and changes to housing investment tax settings. However, employment opportunities and the relative affordability of some regional centres were helping offset those pressures, leaving prices outside Melbourne more resilient.
Terry Rawnsley, KPMG’s director of planning and infrastructure economics, told the newspaper that Melbourne remained expensive for first-home buyers even as prices eased. He pointed to places such as Glenelg and Ararat, where house prices were less than half Melbourne’s median, and described a ripple effect as buyers priced out of Bendigo and Ballarat looked towards smaller centres.
Local agents also described investor interest in Portland, which dominates house sales in Glenelg Shire. The Age reported that the majority of inquiries seen by A1 Real Estate Solutions agent Boyd Falconer came from interstate investors, often through buyer’s agents. Hudson Portland agent Nikki Hudson said a shortage of listings was contributing to price pressure.
Melbourne’s quarterly result moved in the opposite direction. The Domain report put its median house price at $1,014,335, down 3.3 per cent, or $34,192, over the September quarter. Unit prices fell 3.7 per cent to $563,199. Houses had declined for three consecutive quarters, taking the median to a more than five-year low.
In its earlier Melbourne market report, also offered with subscription access, The Age quoted Domain’s Nicola Powell saying the supply of homes for sale was the highest since September 2014. That was giving buyers more choice and pushing prices down, she said. The report confirmed that the latest quarterly figures were released on Thursday.
The regional gains were not uniform. The Age reported that Mansfield’s median fell by more than $75,000 during the September quarter to $675,000, with local agent Toni Maynes describing a year dominated by holiday-home and Airbnb sales. Domain also distinguishes its measures: capital-city figures use a stratified median, while other areas use the middle sale price. The regional annual rise and Melbourne’s quarterly fall therefore describe different periods as well as different markets.
