We’ve been working in the Ballarat market consistently now for over a decade. Our reasons for selecting Ballarat were always that of balanced growth and yield…. not extreme capital growth.
I’ve maintained consistent advisory position when it comes to Ballarat; “it has offered fantastic growth of late, but long term, it isn’t meant to out-perform Melbourne.” However, this exciting little city has proven otherwise for a little while now, and it’s hard to imagine it easing when we consider the rate of change, the growth drivers, and the magnetic pull it seems to have on many metro buyers who are making the tree change.
“Real Estate Institute of Victoria figures showing median sale prices in central Ballarat rose by 102 per cent to $698,062 between 2016 and 2021. In Bendigo, they increased by 59.7 per cent to $635,000 and Geelong grew by 52 per cent to $1.05 million.” (Source: The Age, March 13, 2022)
The growth in Ballarat has surprised many, despite the fact that we’ve had several elements driving the growth of this beautiful, provincial city over the past decade. From state government incentives for tree-changes, (eg. “Good Move), decentralised jobs and capital investment in new office buildings, improved rail lines, upgraded freeway access to local government sponsored support for arts and other local attractions, it’s little wonder it’s become a city of interest for many.
Source: Population Australia
So, why has Ballarat outperformed our capital city over the past five years?
The last two years could not have been predicted, and we hear the word “unprecedented” a lot when it comes to weighing up the changes that were triggerered by the pandemic. The agents described the onslaught of Melbourne buyers as just that – an onslaught. Between our lockdowns, offers were being thrown at them within minutes of a property’s first open for inspection. Worse still, during lockdown, they were receiving unconditional offers via email from sight-unseen buyers who had decided that half a million dollars was worth the gamble to secure a property in this popular region. It was a heady time for every property professional in Ballarat; selling agents, valuers and property managers.
However, putting COVID-19 to one side, there are still other significant drivers aiding Ballarat’s growth. This little cottage in popular Ballarat East tells a great story.
One of our past clients transacted this property and it has had a relatively frequent history of sale activity. According to the agents, all sales were motivated by external/personal factors. What is intriguing is the steady pace of growth show in this sale history below.
When we consider Ballarat as a proposition for investors, the reasons why many investors choose Ballarat come down to the greater rental yields on offer, (specifically; eased cashflow), but more often, the drawcard relates to stellar growth for a lesser budget. Unlike a period home in a capital city, Ballarat enables investors to enter the market closer to half a million dollars, (as opposed to $1.5M – $2M).
Relative affordability counts for a lot.
The same can be said for owner-occupiers. People are making the tree-change to this region because the value proposition makes sense. Ballarat is ninety to one hundred minutes’ drive from Melbourne. Trains are regular too. Not that inhabitants need to dash back to Melbourne, though. These days, the work from home (WFH) phenomenon is more noticeable than ever in places like Ballarat, and for those who are considering health services and education, this exciting city offers some of the best. The Ballarat Base Hospital and St John of God hospitals employ many health workers, including university students and resident year doctors. The private schools in town are well known for their quality of education and some top the list for the state’s best. Local parents comment on the cost of their children’s school fees, when contrasted against the well known private schools in Melbourne.
Not only is housing affordability attractive, but the cost of living in Ballarat is also attractive.
It’s little wonder this city has continued to soar, and while vendor listing numbers remain subdued, we expect Ballarat will keep surprising us.
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