New research has found that long-term property ownership remains vital to achieving robust capital growth, with some locations outperforming others significantly, according to the Property Investment Professionals of Australia (PIPA).

Analysis of Australian Bureau of Statistics’ established median dwelling values from June 2004 to June 2024 found some surprising results – with the top location recording growth of 233% versus the bottom location 100% over the two-decade period.

PIPA Board Director and former PIPA Chair Peter Koulizos, who completed the research, said the results proved that property is a safe and stable performer over the long-term, with location selection key.

“What I found most interesting was the fact that over the past 20 years, it has mainly been smaller capital cities or more affordable regions that have produced the very best results,” he said.

The top result was the Rest of Tasmania where its established median house price has soared from $169,000 to nearly $449,000 over the past 20 years.

The best capital city performers were also some of our nation’s most affordable throughout the period with Adelaide, Hobart, and Brisbane taking out the top three city rankings.

“These sorts of results also show that property markets are not linear – rather, price growth occurs at varying points through the years,” Mr Koulizos said.

“Consider that Hobart has experienced a softening of prices over the past few years, but its established median house price has risen by 193% since June 2004.

“Likewise, with Adelaide and Brisbane, whose markets are very strong at present, but where both had long periods of flat-lining price points throughout the years.”

In comparison, over the past 20 years, the S&P/ASX 200 increased by 120%, according to investing.com. PIPA Chair Nicola McDougall said while savvy property owners should always adopt a long-term mindset, that was becoming increasingly more difficult for investors with higher holding costs, constantly changing tenancy legislation, as well as new property taxes.

“Further analysis of the 2024 PIPA Annual Investor Sentiment Survey found that some 61% of investors who sold in the past year had a holding period of less than 10 years,” Ms McDougall said.

“Plus, about 17% of those investors who sold indicated they had owned the property for less than three years.

“With property transactions attracting such high entry and exit costs, it is safe to assume that these investors simply could no longer financially afford to hold onto their properties and made the difficult decision to sell, including in Melbourne, where prices have been falling.”

Ms McDougall said Darwin and the Rest of NT were the bottom performers over the past 20 years, with established median house price growth of 136% and 100% respectively.

“These markets remain affordable compared to the majority of the country, however, the region’s economic fundamentals have been far from stellar over the years, which has resulted in its under-par property market performance,” she said.

“That said, the NT Government’s new HomeGrown Territory and Fresh Start New Home programs, which includes three different grants ranging from $10,000 to $50,000 and encompass both first home buyers and existing home owners, are smart policies that aim to address the region’s population woes and will likely have a positive impact on property prices in the future.”  

ENDS

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