Ballarat property prices continue to maintain a steady growth against strong activity in Melbourne.
It joins other provincial cities of Bendigo and Geelong in enjoying higher price increases, with strong sales continuing in metropolitan areas in recent months.
REIV CEO Enzo Raimondo said record low interest rates continued to fan the growth in property prices at a solid pace, with the REIV’s house price index (HPI) up by about 3.4 per cent in the past 12 months.
Mr Raimondo said the HPI was “a useful measure of market activity based on sales data”.
“It has reflected higher price increases across the three major regional centres of Ballarat, Bendigo and Geelong,” he said.
Ballarat had the weakest growth of the three regional areas with 3.4 per cent to May this year against May 2013. Bendigo reported the strongest growth with 6.5 per cent and Geelong with 6.4 per cent.
REIV reports the rolling annual median prices, or 12 months to the end of May 2014, compared to the 12 months to end of May 2013, for the three regional areas as:
City 2014 2013
Ballarat $300k $290k
Bendigo $330k $310k
Geelong $415k $390k
Mr Raimondo said clearance rates were lower than compared with Melbourne as there were far fewer auctions than private sales in regional Victoria.
Clearance rates for the five months to the end of May this year are Ballarat at 64 per cent, Geelong at 61 per cent and Bendigo at 51 per cent.
Unit and townhouse prices in regional Victoria have also showed solid growth, Mr Raimondo said.
The REIV calculated a Unit Price Index, reflecting activity in the sale of units, townhouses and apartments, as up by 2.7 per cent in the past 12 months.
“For investors in regional Victoria the news was also steady on the rental market,” he said. “The vacancy rate across the state was stable at 2.5 per cent in May.
“And although there were small increases in the vacancy rate for these three major regional centres – up 0.3 per cent to 4.3 per cent in Geelong, up 0.1 per cent to 2.4 per cent in Bendigo and up 0.3 per cent to 2.4 per cent in Ballarat – there has been a general reduction in the vacancy rate over the past year.”
Median house rents across the state rose from $295 a week in April to $300 a week in May – a 1.7 per cent increase. There was a $10 a week increase in Bendigo to $300, while Geelong remained stable at $330 and Ballarat stable at $280. The median unit rental across regional Victoria fell slightly in May – but has grown in the past year, and is currently at $240 a week.
“With new housing being built in a number of regional centres and towns, and those homes being sought for both lifestyle and affordability reasons, the increase in new residential building approvals in Victoria in April was good news,” Mr Raimondo said. “The 14.8 per cent increase was above the five-year average and more than half those approvals were for houses.”