Home prices in ‘affordable’ regional Queensland towns continue to rise as the national housing market drops

A 25-year-old buying a two-storey house with a picturesque garden for just over $300,000 goes back to the early 1990s.

But in outback Queensland towns such as Longreach, it’s the norm.

The Reserve Bank of Australia yesterday raised interest rates for the fourth consecutive month, but Longreach resident Ben Galea said he was not stressed.

“When it comes time for my fixed interest rate to change… I don’t have to change my lifestyle,” Mr. Galea said.

“It’s a great town. It’s buzzing. There are a lot of young people here. There are lots to do, lots of sports. It’s brilliant.

“There are things that we don’t have out here. It costs money to fly back to the coast. You don’t see family as often. These are the things you give up.”

As interest rates rise, home values ​​in Australia are dropping at their fastest pace since the global financial crisis, with the latest data showing that the nation’s median property value has dropped by 2 per cent since the beginning of May, to $747,182.

Mr. Galea purchased his home last year for $310,000 at a “beautiful” fixed rate of 1.9 per cent.(Supplied)

But parts of regional Queensland are tipped to be more insulated from price drops than cities, and some regions have continued to see property prices increase in the last month.

Regional Australia Institute chief executive Liz Ritchie said it was mostly due to housing affordability in the regions.

“What we won’t see is the markets in regional Australia and regional Queensland fall as sharply,” she said.

“In the past couple of years, regions have seen significant price growth…but this is off years of just having steady incremental growth.

“The shocks that we’re seeing with interest rate hikes just won’t be felt in the same way, particularly in Queensland’s more rural and remote communities.”

Regional buyers ‘not overly worried’

Toowoomba-based Heritage Bank’s chief operating officer Dan Dredge said recent hikes to interest rates had not affected the number of people applying for home loans in regional Queensland through his bank.

Young man lighting a fire with a circle of friends.
Mr Galea says he loves the lifestyle and community in western Queensland.(ABC Western Qld: Victoria Pengilley)

“We’re not seeing people being overly worried by interest rate rises,” Mr Dredge said.

“What we’re seeing is people budgeting and setting their expectations on higher interest rates, moving forward.”

Data from CoreLogic found dwelling values ​​in regional Queensland fell by 0.8 per cent in July, compared to larger falls of 2.2 per cent in Sydney and 1.5 per cent in Melbourne.

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