But value growth in regions narrows gap with capitals
Australia’s regional housing markets are still outperforming the capital cities in terms of value growth, though the advantage has shrunk since the beginning of the year, according to new figures from the Cotality Regional Market Update.
Dwelling values in regional areas rose by 1.5% in the three months to April, outpacing the 1% growth recorded across capital cities. However, the difference is less pronounced compared to earlier in the year. In January, regional values had risen 1%, while capital cities had seen a 1% drop in the same period. The recent turnaround in city markets has reduced the growth divide.
“We’re also seeing a convergence among the regions with momentum easing in recent high-growth markets and picking up in previously softer regions,” said Cotality economist Kaytlin Ezzy (pictured above).
The gap in performance between Australia’s 50 largest regional significant urban areas (SUAs) also narrowed. The difference between the strongest and weakest quarterly performers dropped to 7.3 percentage points in April, down from 14.7 points in July 2024.
WA leads growth, Queensland slips
Western Australia continued to show strong performance, with Albany leading quarterly growth at 7%, followed by Geraldton at 4.5%. Other strong performers included Victor Harbour–Goolwa in South Australia (4.2%), Mildura–Buronga (4.1%), and Mackay (4.0%). Queensland’s previously dominant position weakened, especially in mining regions.
“While still taking out one spot in the top five, these results show a weakening of QLD’s grasp on the leaderboard,” Ezzy said. “The pace of quarterly growth has eased significantly in QLD’s mining markets amid worsening affordability and global economic uncertainty.”
Despite a softer quarterly performance, WA and Queensland still held most of the top spots for annual growth. Geraldton values rose 26.9% over the year to April, while Gladstone, Townsville, Mackay and Albany all posted annual gains above 20%.
On the downside, Bathurst, Nelson Bay and Geelong saw minor value declines of -0.3%, -0.2%, and -0.1% respectively during the quarter. Warrnambool recorded the largest annual fall at -4.2%, followed by Ballarat and Geelong, each down -2.2%.
Selling conditions reflect regional momentum
Sales activity remained strongest in WA and Queensland, mirroring annual value growth. Homes in Rockhampton, Gladstone, Mackay and Townsville sold the fastest, with median times on market ranging from 11 to 13 days. Albany sellers offered the smallest discounts, at -2.3%.
In contrast, market conditions were weaker in parts of NSW and Victoria. Bowral–Mittagong had the slowest turnover with homes taking a median 77 days to sell and the highest vendor discounts at -5.3%. Batemans Bay and Traralgon–Morwell also showed soft conditions, with longer sale times and higher discounts.
Rent growth slows but remains strong in regions
Annual rent growth in regional areas eased to 5.5% in the year to April, down from the 6.7% peak recorded in September 2024. Despite this moderation, rents in the regions remain well above the 2.9% annual growth seen in capital cities.
“Even as growth moderates, we continue to see reasonably strong rental increases across most regional markets, reflecting tight supply and shifting demand patterns,” she said.
Only one regional centre — Wagga Wagga — saw a quarterly drop in rental values, falling by -0.5%. On the other end, Albany led the quarter with a 5.7% increase in rents, followed by Burnie–Somerset (4.4%) and Taree (3.9%).
For the year, Albany also recorded the highest rent increase, up 13% or $68 per week. Geraldton and Victor Harbour–Goolwa also reported double-digit annual gains.
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