What does the Geelong Property Market Look Like in 2021?
2020 brought many things that we could not predict, but it was not all negative. Despite the considerable uncertainties that accompanied the pandemic, the Geelong property market accelerated with rising demand from new buyers and continuous construction.
Geelong has remained one of the fastest-growing regional areas in the country, and momentum is proving to be a strong predictor of how it will continue to perform in 2021. Here are some of the key themes that are unfolding.
Demand will continue to skyrocket.
Despite unemployment caused by the pandemic and the challenges that many small businesses continue to face, interest in residential property remains strong – with the price of real estate in Geelong continuing to increase. Geelong home values rose three times as fast as Melbourne’s in January 2021, with Geelong recording a 1.5 per cent rise – more than triple the 0.4 per cent recorded in Melbourne.
Additionally, Geelong’s median dwelling value rose 5.5 per cent to $618,987 over the last 12 months to January 31 (CoreLogic Home Value Index).
The attractive lifestyle that the Geelong region offers is obvious. With easy access to the Surfcoast and Bellarine Peninsula, along with affordability compared to Melbourne. It continues to be such a popular place to buy that investors are purchasing Geelong properties without even seeing them first. This increased demand in Geelong real estate has contributed to properties selling at auction well above their reserve prices. Forecasts see this continuing throughout 2021.
First home buyers will continue to dominate the market.
The variety of incentives and grants from the State and Federal Government, especially concerning building, have allowed the aspiration of owning property in Geelong to be realised by first home buyers sooner than they thought.
Nationwide, first home buyers made up more than 50% of the housing market in 2020 (Scott, 2021). With fees suspended and commuting, appointments, and travel not an option, the deposit savings of those who worked during the lockdown grew considerably. This increase in savings, coupled with record-low interest rates and assurance from the Reserve Bank of Australia that these will not rise for at least the next three years, has seen the confidence of first home buyers in the Geelong property market at an all-time high.
City dwellers will continue to seek a sea change.
With working from home becoming the new normal and therefore more time spent inside smaller spaces, priorities for those living in the city continue to change. We are seeing those making the move from Melbourne to Geelong getting more value for their money, along with an ideal lifestyle change – all while being within a place that remains a commutable distance to the city. Many city dwellers are willing to pay a premium for property in neighbourhoods that still allow them the metropolitan feel with modern conveniences, in addition to the coastal escape. And whilst the idea of a sea change has been trending for some time, the pandemic has only increased its desirability, which means that the competition with Melbourne buyers will remain.
Michael De Stefano is a real estate expert and principal of Gartland Property, one of Geelong’s premier property agencies.