How this year’s ‘great migration’ has impacted real estate
CEO of Hockingstuart, Peter Hanscomb, examines how this year’s unprecedented increase in internal migration—the ‘great migration’—has impacted the Australian property market, which has seen record prices as demand outstrips supply in many areas.
2021 has been a milestone year for the Australian property market. Demand has far outstripped supply and driven prices to record-setting heights.
The seller's market was bolstered by several factors, including historically low interest rates, the return of expats to our shores, and swollen bank accounts due to travel bans and lockdowns. All of these factors led to heightened competition amongst buyers; however, the most notable influence was a significant increase in internal migration—referred to as the ‘great migration’.
The Australian Bureau of Statistics' Regional Internal Migration reports show Greater Melbourne and Greater Sydney lost 27,200 and 31,300 residents, respectively, between April 2020 and April 2021. These numbers are expected to rise as data from the peak of the Delta variant outbreak is made available.
The ABC reported that more than 57,000 travel permits were approved between 20 August 2021 and 28 September 2021 to allow people from Greater Sydney, who genuinely needed somewhere to live, to visit regional New South Wales to look at real estate. Permit requests were so popular that the State Government removed exemptions for investors to travel to the regions from August 2021.
While we do not have a complete picture of internal migrations just yet, the desirability of regional New South Wales is overwhelmingly apparent in local property prices. Corelogic data shows the state's top five median price changes have all occurred in regional areas, with Lightning Ridge up 200 per cent, Dolphin Point up 192 per cent, Louth Park up 186 per cent, Farley up 139 per cent, and Gerroa up 123 per cent in the past 12 months alone.
Demand is so significant in Byron Bay that the surfing mecca has dethroned Sydney as Australia's most expensive place to buy a house. Recent Corelogic data shows Byron’s median house price is currently sitting at $2.7 million, up 49% over the last 12 months and well above Sydney’s current median house price of $1.499 million.
Our network's activity also reflects the current internal migration trend. Geelong and Torquay Principal, Peter Julian took out the coveted highest number of transactions in our 2021 Belle Property and Hockingstuart awards. While Byron Bay and Lennox Head Principal, Braden Walters was recognised as Australia's Best Property Marketer at this year's RIEA National Awards for Excellence. Sydney, Melbourne and Brisbane agents have historically dominated these honours, so it's incredibly inspiring to witness the fantastic achievements of our agents in regional centres.
COVID-19 has changed our lifestyle priorities, and it looks like the internal migration property trend is set to continue into 2022 and beyond. Work-from-home arrangements have given city-dwellers the flexibility to explore areas outside of their standard commuting range, with regional hubs like Byron, Lismore, the Gold Coast, Toowoomba, the Sunshine Coast, the Mornington Peninsular, Greater Geelong, and Victoria's Surf Coast offering easy commutes to state capitals via short plane, car or train trips.
But snapping up a regional property isn't as simple as it sounds and can be a daunting experience if you lack familiarity with the local area and market. To help you navigate the trend, here are three things to consider.
Firstly, get your finances in order before you start your property search. Pre-approval from the bank puts you in a strong position by giving you an advantage over other buyers who still need to go through a timely process. If you make an offer that is 'subject to finance', you run the risk of prompting others to place offers while you get yourself together, which may result in you missing out on the property.
Secondly, introduce yourself to local agents to find out what is happening in the market and let them know what you are looking for, so that they keep you in mind when a new property becomes available. Your relationship with a local agent could be your ticket to the property of your dreams
Thirdly, consider enlisting the support of a buyer's agent service. A good buyer's agent will take the stress out of the process as your eyes, ears and voice on the ground, open 'closed' doors, offer real transparency into the market, and facilitate every element of the journey for you – from researching to negotiation.
The COVID-19 pandemic has completely changed our lives. It's changed our perspectives, how and where we work, and how and where we live. 2020 and 2021 will go down in the history books for catalysing the most remarkable internal migration Australia has ever seen, and its legacy is sure to live on long after city freedoms are restored.
If you’re looking for a sea or tree change, search our regional properties for sale here.
Our agents work with a collaborative network of buyer’s agents who specialise in making the market work for buyers. For more information about our services and how we can help to achieve your property goals sooner, speak to your local agent.