- 22 Feb 2025
- By API Magazine
Strong population growth and a trickle rather than sea of city workers returning to the office points to a strong year ahead for regional property markets within New South Wales.
The trend we have dubbed the ‘Exodus to Affordable Lifestyle’ is one of the key reasons I expect regional New South Wales to be one of the strong residential property markets in 2025.
The trend is not new, with big cities like Sydney losing population to internal migration for the past 10 years.
Despite that long history, the trend remains as strong now as it’s ever been and is showing no signs of slowing down.
Big businesses may be demanding that workers return to the office rather than work remotely and in some circumstances that will happen, but on the whole, working remotely is here to stay.
The latest office vacancy data shows the ‘return to the office’ movement is not happening in a major way.
A Property Council of Australia report on office vacancies shows that more offices were empty in January 2025 than six months ago.
In Sydney, home to many finance, insurance and tech workers, the vacancy rate jumped from 11.6 to 12.8 per cent. The number of empty floors in Melbourne remained unchanged, at a historic high of 18 per cent and vacancy rates sat between 9 and 18 per cent in seven of the eight state and territory capital cities.
The movement of people from the biggest cities to regional areas is all about affordability and lifestyle, enabled by technology that allows more people to work remotely. That’s why office vacancies are so high.
Sydney, with a median house price of around $1.2 million, has been steadily losing population and a proportion of that has been relocating to regional NSW, where the median house price is about $750,000 although plenty of regional cities and towns have houses on offer for less than $500,000.
This is a key reason why regional NSW outperformed Sydney on price growth. In the past 12 months, Sydney’s median prices have risen 1.9 per cent for houses and 1.1 per cent for units, while regional NSW has managed 3 per cent for houses and units alike.
Some individual regional markets are doing considerably better. Many suburbs in Wollongong have increased by between 7 and 9 per cent, and a number of Newcastle suburbs have recorded double-digit growth in median house prices, as have some of the Albury locations and several of the suburbs of Tamworth.
Analysis by Hotspotting ranking the eight capital cities and six state regional markets (14 major jurisdictions) from 1 to 14 based on a series of different metrics ranked regional NSW strongly for its growth prospects in 2025.
As such, expect 2025 to be a solid year overall in regional NSW markets, buoyed by affordable prices and solid yields.
Article Q&A
Is regional NSW outperforming Sydney property?
Sydney, with a median house price of around $1.2 million, has been steadily losing population and a proportion of that has been relocating to regional NSW, where the median house price is about $750,000 although plenty of regional cities and towns have houses on offer for less than $500,000. This is a key reason why regional NSW outperformed Sydney on price growth.
Is regional New South Wales a good place to buy property in 2025?
Analysis by Hotspotting ranking the eight capital cities and six state regional markets (14 major jurisdictions) from 1 to 14 based on a series of different metrics ranked regional NSW strongly for its growth prospects in 2025. As such, expect 2025 to be a solid year overall in regional NSW markets, buoyed by affordable prices and solid yields.
Are city workers returning to the office?
A Property Council of Australia report on office vacancies shows that more offices were empty in January 2025 than six months ago. In Sydney, home to many finance, insurance and tech workers, the vacancy rate jumped from 11.6 to 12.8 per cent. The number of empty floors in Melbourne remained unchanged, at a historic high of 18 per cent and vacancy rates sat between 9 and 18 per cent in seven of the eight state and territory capital cities.
