Posted: 2023-02-15 05:49:05

In a case of what goes up must come down, property prices in Byron Bay have plunged 25 per cent in the past 12 months as interest rate hikes start to bite and tree and sea changers move back to the city.

A group of people gather on a beach, with the ocean and a lighthouse in the background
Property prices have fallen at Byron Bay on the north coast of NSW.(ABC News: Natalie Grono)

After experiencing staggering price growth during COVID, the New South Wales Richmond-Tweed area, which takes in Byron, is now the worst performing regional market according to CoreLogic data, with house values falling by an average of 18.6 per cent.

But in what's been described as a "unique downturn", the neighbouring New England and North West areas recorded an increase in prices in the 12 months to January, just behind South Australia's South East where house values rose the most.

So what are some key takeouts from this latest snapshot of housing in regional Australia?

South Australia

Bucking the general downward trend, South Australia's South East was the best performing regional market with Kangaroo Island, the Fleurieu Peninsula and the Limestone Coast recording a 15.7 per cent increase in house values.

Coastline where green hills jut up against deep blue ocean waters under cloudy skies
Kangaroo Island is among the strongest performers in the property market.(ABC News: Jeremy Story Carter)

The median value of a home in the South East is now $426,903 and properties are spending on average 36 days on the market, compared to 38 days this time last year.

CoreLogic head of research Eliza Owen said property prices barely grew in those parts of SA before COVID emboldened people to move away from capital cities such as Adelaide.

"The COVID-boom unlocked enormous value across more affordable regional tree-change markets such as South Australia's South East region," she said.

"The surge in demand for areas such as New England and North West (in NSW) was also likely to have been due to a spill over from nearby markets such as Richmond-Tweed, where the strong migratory sea-change trend and low interest rates priced out many lower income households."

Houses and buildings in Armidale, NSW.
The New England region, which includes Armidale, has recorded property price growth. (Flickr: Denisbin)
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