By Tracey Matthies
BOTH South Gippsland and Bass Coast Shire Councils have been named in eastern Australia’s top 12 most resilient regions by a leading property research consultancy.
The PRD Resilient Regional Areas report compared affordability, property trends, investment, project development and unemployment rates regional areas in Queensland, Victoria, NSW and Tasmania to highlight the most resilient regions with “solid fundamentals for sustainable future growth”.
Bass Coast was listed at number 10 and South Gippsland at 11 with Greater Bendigo City and Moyne Shire the only other Victorian regional centres to make the list.
“Regional areas have seen strong investment into residential, commercial and infrastructure developments over the past 24 months. Further, regional markets tend to be more insulated to economic shocks,” the report said.
“Regional property markets tend to be more resilient compared to their capital city counterparts due to being slightly more insulated from economic shocks, and many local/state governments prioritising regional areas’ growth over the past five years.”
The PRD report noted Bass Coast Shire Council had a low unemployment rate of just 3.7 per cent in the December 2019 quarter.
“Bass Coast LGA [Local Government Authority] also stacks up well for local employment, and in turn economic stability for residents, when compared to Victoria’s average unemployment rate of 4.7 per cent.”
The area was described as “quite affordable” with almost 43 per cent of residents owning their homes outright despite strong positive growth in median property prices and long-term property growth trends.
Average rental yields of 3.7 per cent for houses and 4.7 per cent for units were higher than Melbourne.
“Additionally, a very low vacancy rate of just 1.6 per cent suggests that there is high demand for rental stock in the area, making Bass Coast LGA an area well worth considering for savvy investors” the report concluded.
A primarily commercial development pipeline worth an estimated $130.8 milion for 2020 was described a vital to ensure employment opportunities for a rapidly growing population.
“A further $7.2 million is set to be spent on infrastructure projects, which is vital to ensure sufficient amenities are created and maintained for the benefit of residents and visitors alike.
“A further $3.3 million in residential development will create a total of 94 lots to add to the Bass Coast LGA property market. Projects such as these are vital to ensure population growth is manageable in the long-term.”
The picture is just as bright for South Gippsland Shire Council.
“A very low unemployment rate of just 2.2 per cent … is an indication of economic stability in the area, while 43.5 per cent of residents owning their own homes outright … alludes to both the affordability and desirability of South Gippsland LGA” PRD reported.
The municipality enjoyed a strong long term growth in median house prices as well as increases in median land prices ( 6.3 per cent) and median unit prices.
“This shows that property in South Gippsland LGA have seen healthy capital gains recently.”
It was also good news for investors with “solid average rental yields of 5.9 per cent for houses and 5.3 per cent for units”, again, well above Melbourne results for the same period.
“Further, a vacancy rate of 2 per cent is considered to be healthy, indicating solid demand for rental stock in the area. Together these statistics highlight the real potential on offer for savvy investors considering an affordable alternative to Melbourne metro,” the report said.
Almost 85 percent of the $278.6 million worth of developments set to occur in South Gippsland this year is to be spent of infrastructure, including roadworks, marine facilities, footpaths and other upgrades “which are key for the ongoing comfort and safety of residents”.
Commercial projects valued at $35.9 million would help stimulate local economic activity, and $45.1 million of residential spending would create 27 lots and 15 dwellings, “ensuring local population growth is sustainable”.