Young Victorians embrace regional property boom as affordability drives demand

WITH DANIEL WALSH AND LEIGH DELEDIO FROM UFINANCIAL

Victoria’s real estate market is witnessing a significant shift as young first-home buyers increasingly seek affordable housing in regional areas.

According to recent data from the Australian Bureau of Statistics (ABS), first-home buyer loans in Victoria soared to 4,202 in July – the highest number in nearly two years. This surge reflects growing confidence among young buyers and a trend towards exploring housing options beyond Melbourne.

Nationally, the Commonwealth Bank of Australia and the Regional Australia Institute report that the flow of people from cities to regional areas is now about 16 per cent above pre-pandemic levels. The Regional Movers Index indicates a 27 per cent increase in people moving from cities to regional areas compared to those moving in the opposite direction during the last June quarter. Over the past year, 11.2 per cent of movers have relocated from cities to regions, with three-quarters settling in NSW or Victoria, up from half of all movers last year.

Government incentives such as the First Home Owner Grant and stamp duty exemptions are boosting this trend. Regional hotspots such as Ballarat, Bendigo, and Geelong are seeing heightened interest from first-home buyers eager to take advantage of lower property prices. Greater Geelong, in particular, has emerged as the most sought-after regional Local Government Area in Victoria.

In contrast to Melbourne’s median house price of more than $900,000, regional Victoria offers more affordable options. Geelong’s median house price is $720,000, while Ballarat and Bendigo are even more budget-friendly at approximately $550,000 and $490,000, respectively. This affordability makes homeownership accessible for young buyers who might be priced out of Melbourne’s competitive market.

The work-from-home trend, accelerated by the pandemic, has also contributed to this shift. Many Victorians now have the flexibility to work remotely, making it feasible to live in regional areas while maintaining their careers. This flexibility enables buyers to enjoy a better lifestyle balance without sacrificing their job connections in Melbourne.

As government incentives persist and regional prices remain appealing, young Victorians are increasingly finding their path to homeownership in the growing communities of regional Victoria. This shift is reshaping the state’s property market, driven by a desire for affordability and a better quality of life outside the city.