Property prices in pockets of regional Australia have grown by more than 40 per cent in the past year, according to a new report, largely the result of cheap credit and the work-from-home revolution.
The latest regional market update from CoreLogic analysed house price growth in regional local government areas in all states.
Unit values in the Clarence Valley LGA, in northern NSW, were up 45.6 per cent in the 12 months to October 2021, and up 43 per cent in the Armidale LGA, in the Northern Tablelands.
House prices in the West Coast council region in Tasmania were up 41.4 per cent, the highest rate of house price growth outside of Western Australia. Towns there include Queenstown and Strahan.
House prices in the Byron LGA grew by 39.7 per cent, just ahead of the Kiama LGA, where they were up 39.5 per cent.
Price growth was more subdued in Victoria, though the Mansfield council area recorded a 34.9 per cent increase in unit values across the year. Unit values in Warrnambool were up 33.9 per cent.
As well as listing local government growth figures, the report also analysed the 25 largest regional SA4 areas, which cover a broader geographic area.
The Shoalhaven and Southern Highlands region recorded the highest level of price growth of all markets analysed, with house prices there up 35.9 per cent.
Six other regions recorded house price growth above 30 per cent, including the Richmond - Tweed region in northern NSW, up 32.8 per cent and Queensland's Sunshine Coast, up 32.3 per cent.
"The top performing regional areas were all coastal or lifestyle markets generally within a two-hour commuting distance of a capital city," CoreLogic research director Tim Lawless said.
"These areas fit within the broad trend where demand has surged for lifestyle properties that offer a blend of liveability and commutability."
The report also analysed other market metrics in these 25 regions, including days on market.
Houses on the Gold Coast sold fastest, taking just 18 days, while the slowest-moving market was New England and North West NSW, where they took around 62 days to change hands.
Mr Lawless said there were strong signs that the work-from-home trend, which had driven migration to the regions from capital cities in the past two years, was likely here to stay.
But worsening affordability in the regions meant that the boom in prices there was not sustainable.
"If housing values across regional parts of the country continue to outpace the capitals, the obvious outcome will be that regional markets lose their affordability advantage," Mr Lawless said.
"We can already see this trend taking shape in some of the most popular regional coastal markets such as Byron Bay where median house values are $1.7 million and Noosa on the Sunshine Coast in Queensland, where median house values are $1.2 million, much higher than comparable capital city values."