Regional Victorian towns that boomed most in the last five years
Rents increased across every town in regional Victoria over the last five years, and rose as much as 60 to 70 per cent in suburbs that were once more affordable.
Property investors selling to owner-occupiers, combined with a growing regional population, has steadily driven up prices, experts say.
Suburbs around Shepparton and Bendigo are among those that copped some of the steepest rent rises in the five years to March 2024, Domain data shows.
Domain head of research and economics Dr Nicola Powell said the five-year increase “showcases that demand has run well ahead of supply”.
“You’re really capturing that point in time that changed the dynamics of where people could reside. We saw that exit into those regional locations where people flocked to tree and sea change locations,” Powell said.
“Rents have risen at a much greater rate than wage growth...so it does impact those local residents who are on a local wage because what it does is it creates that affordability barrier and it means that they have to then relocate to a neighbouring suburb, or compromise on the number of bedrooms or the type of property they’re renting.”
Victoria’s regional suburbs have seen rents increase over the last five years.Credit: Joe Armao
The town of Numurkah, near Shepparton, recorded the largest five year rise, with asking rents jumping by 73.5 per cent to a median $425 per week.
Eaglehawk, a suburb in the Bendigo region, saw rents increase by 60.7 per cent to $450.
Principal director at Gagliardi Scott Real Estate Rocky Gagliardi, which has offices in Shepparton and Numurkah, said skyrocketing rents were being driven up by a lack of supply.
Gagliardi said many landlords in the area were packing up and selling their properties.
“The land tax has just become unattainable for a lot of investors in an area like Numurkah…that was just the final straw for a lot of (landlords). A lot of them are working on farms, they’re not really flush with extra income, so they’re relying on that extra income to come from housing,” Gagliardi said.
“We’ve sold a lot of investment properties and we’ve had a lot of them being bought out by first-time buyers.”
Gagliardi added that more workers have been attracted to the Numurkah and Shepparton areas as a result of booming industry and hospital jobs, with not enough rental properties to meet demand.
“(Workers) are interested in being here for two, maybe three years and then…moving out back to Sydney or Melbourne. They’re not looking to invest or stay long term in Numurkah, that’s just a base for them,” he said.
Rents have risen in the Bendigo region.Credit: Joe Armao
McKean McGregor property management department manager Nathan Ludeman said a similar trend was occurring in the Bendigo region, with many healthcare workers moving to the area for jobs at Bendigo Hospital.
Ludeman said some renters had been priced out of Bendigo’s central suburbs, with many turning to neighbouring Eaglehawk over the last few years.
“(Eaglehawk) is an area where prices were probably lower than others, but because of the supply and demand, those prices ended up going up quite considerably. It was trying to meet the rest of the market because (prices) were lower in the first place,” Ludeman said.
“When the market became so tight, and you’ve got other areas where people can’t get into, all of a sudden, there was higher demand in Eaglehawk.”
Ludeman added that there were a lot of rentals sitting empty around Bendigo, with increased costs for landlords deterring them from leasing out their properties.
“(Landlords) feel it is (in the tenants’ favour) when they’re just getting hammered with land tax, interest rates, minimum standards and having to spend all this extra money on their property,” he said.
“There are a lot of empty properties in Bendigo...they’re just sitting there because (landlords) don’t want to take the risk.”
Tenants Victoria CEO Jennifer Beveridge said there was “a very limited pool of rental homes” in the regions, adding that locals could be forced out of their communities if they can’t afford rent rises.
“Having to move because of rent rises is difficult across the board for renters – they have to move further away from their jobs, community connections, services and schools. It’s even harder for renters in the regions because they may have to move to another town a long way from their community,” she said.
Beveridge said Tenants Victoria had received many queries from renters across the state asking how to break their leases because they cannot afford a rent increase, reporting rises of anywhere between 30 to 70 per cent.
“People on very low incomes are the most affected, while also facing broader cost of living pressures. People on middle incomes are also affected, as they may not be able to find suitable accommodation within commuting distance of their jobs in regional Victoria,” Beveridge said.
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