Analysis of recent economic data suggests that the property markets of several lower profile Australian cities have more to look forward to than our most populous cities.

According to property market analysts, Propertyology, recent employment data adds to a building list of positive indicators suggesting that the outlook for Hobart remains superior to all other capital cities. Meanwhile, there’s a healthy list of regional cities with economic trends which also catch the eye of their analysis.

Official data published by Australian Bureau of Statistics shows the increase in jobs in Hobart over the last 12 months is four times higher than the national average of 2.1 per cent and more than double every other capital city.

“There was an 8.4 per cent increase in jobs in Hobart over the last 12 months. And it’s no coincidence that recently released data by Domain confirmed that Hobart had the biggest increase in median property values of all capital cities over the 12 months ending June 2017,” said Propertyology’s Head Of Property Market Research, Simon Pressley.

It was a classic case of ‘daylight second’ in the ABS jobs race with Melbourne producing a 3.5 per cent increase, followed by Adelaide (2.2 per cent). Growth in Sydney and Canberra was equal to the 2.1 per cent national average.

“Changes in job volumes at an individual city level ~ as opposed to just looking at an unemployment rate in isolation ~ provides more insight in to future performance of property markets,” Pressley said.

Propertyology’s analysis of every local government jurisdictions across Australia uncovered some encouraging signs for parts of regional Australia, where 8 million Australians elect to live, work, and play. 

Dubbo, which performs the role of a capital city for the broader central-west New South Wales region, produced a 21.6 per cent increase in employment over the two years ending May 2017. Infrastructure projects such as the hospital expansion and an increase in business and leisure airport patronage along with good growth in the retail and tourism sectors are driving the region’s economy.

“Several Queensland regional cities are producing green shoots. The 12.7 per cent increase in jobs over the last 12 months in Townsville is just the start of what shapes as a significant revival. Our Townsville Market Outlook report lists a big bunch of reasons for optimism in Australia’s thirteenth largest city,” said Pressley.

A very solid 12 months has also unfolded in Mackay (7.6 per cent growth), Beaudesert / Logan (10.2 per cent), and Toowoomba (12.8 per cent).

The 6.3 per cent employment growth for the year ending May 2017 in Cairns is three times above the national average. 

“Cairns is Australia’s gateway to Asia. Demand from international students, domestic and international business conferences, and tourism are through the roof. A Cairns construction boom is about to unfold in the form of new hotels, resorts, and expansions of the Cairns convention centre, sea port, and Bruce highway”.

“Our analysis suggests that the property markets of most big profile cities will not perform as well as various major regional cities. The rise of Hobart is the start of a new era of unsuspecting property market stars. There are several regional cities with extremely affordable housing and good economic outlooks that our buyer’s agents are helping our clients invest in today,” said Pressley.

The biggest increase in job volumes in Australia over the 2 years ending May 2017 was in the Victorian regional city of Geelong. 22.3 per cent growth is off the charts although Propertyology does note that a retraction in jobs of 3.1 per cent over the last 12 months might be a sign that perhaps the best buying times in Geelong are behind us.

The regional city of Shepparton, where a typical house only costs approximately $250,000, has sustained employment growth of 19.1 per cent over the last couple of years. Bendigo (6.3 per cent) is another Victorian regional location with solid jobs data.

Newcastle, arguably the most consistent property market performer in all of Australia over the last decade, produced 12.6 per cent growth in job volumes over the last 2 years. 

Employment growth of 9.4 per cent in Mid-North Coast (Port Macquarie) last year was also significant. 

Propertyology says that employment trends are often a precursor to property market trends. Their analysis reveals that Sydney (home to 21.2 per cent of Australia’s population) and Melbourne (18.7 per cent) – where property markets have performed strongly over the last four years – together produced 57 per cent of Australia’s total job creation over the same period.

“The relationship between percentage of national job creation and percentage of total Australian population for all capital cities is remarkably consistent with how their respective property markets have performed over the last four years.”

Propertyology says there can often be a lag of 12-18 months before what’s occurring on the jobs front is materially reflected in real property data. 

Pressley says that, at a base level, property is shelter. Wherever there is demand for more jobs in the future there will be demand for more shelter! “This core philosophy is something which is engrained in Propertyology’s methodology for forecasting. We place more emphasis on economic trends than property-specific data”.

The correlation between employment growth and property market performance was again evident in Brisbane (1.3 per cent) and Perth (0.6 per cent), both below the national average employment growth rate, while Darwin saw a 0.8 per cent retraction in jobs.

The anticipated continued improvement in Tasmania’s economy influences Propertyology’s forecast for Australia’s most affordable capital city to continue to be the nation’s best performer for quite some time yet.

Meanwhile, Coffs Harbour (10.2 per cent) and Shoalhaven (25.1 per cent) both saw a significant retraction in jobs over the last 12 months.

In addition to economic development (jobs), Propertyology believes that the factors which have the biggest influence on property prices are affordability, sentiment, and supply. Pressley says that it’s never ONE thing which they base their forecasts on; it’s the sum of all of these things!

Read more about regional growth hotspots:

Selling up in Melbourne to be mortgage free in Geelong

Twenty per cent of Newcastle sales from Sydney buyers: PRDnationwide

Pilbara region showing signs of recovery: REIWA