The Gentrification of Geelong
It’s All About Regional Relocation
The year the coronavirus pandemic hit is also the year that saw many Australians move cities from the crowded CBDs to the regional suburbs. It’s a trend sweeping Australia with outer suburbs appealing to buyers’ minds with the promise of a better, more affordable lifestyle. The previous year created an ideal opportunity for people to buy property in highly populated regional lifestyle areas as the lockdowns paved the way for remote work to become more commonplace.
CoreLogic’s Pain and Gain report for the last quarter of 2020 saw regional Victoria, along with Hobart, as the most profitable region with 97.5% of dwellings sold for a profit in September 2020 alone. Also, together with the help of the government’s HomeBuilder scheme, a lot of first-home buyers were able to jump in and fuel the population growth in regional areas such as Geelong.
Fast Facts About Geelong
Location: South West of Melbourne
Current population: 253,000
Median house price: $885,000
Median Rent: $430 pw
Geelong is the second largest city in Victoria. Its residential population has seen a significant rise in previous months, mostly from Melbourne city dwellers. This has increased competition for properties and has driven the prices up.
Lifestyle and infrastructure have been the biggest drivers in post-lockdown migrations and Geelong has consistently been presenting itself to possess both. Located just an hour away from Melbourne, this regional city has been dubbed a property hotspot worth considering and rapidly growing.
Geelong, and its surrounding suburbs, has been a top choice for both home-buyers and investors for a number of years now. A thriving local food, and retail scene exists in Geelong. The whole region is known for having a more relaxed and laidback vibe, and is also a home to good public and private schools.
The main industries Geelong’s residents work in are health care and social assistance (17.4%), retail trade (10.9%), education and training (10.1%), food and hospitality (9%), manufacturing (8.5%), construction (8.1%), scientific and technical services (7.1%), public administration and safety (4.5%), and financial and insurance services (3.5%)
Is Geelong A Property Hotspot?
Property hotspots are emerging localities continue to witness a rise in population, a surge in infrastructure projects and an increase in local employment opportunities. According to Terry Ryder, Founder and CEO of Hotspotting.com, these three (infrastructure, employment, and population), are the deciding factors in what makes an area considered a hotspot and a prime choice for home-buyers and property investors alike.
In the case of Geelong, all three factors currently show much potential and growth.
Geelong’s Indicators of Growth
1. Transport and Infrastructure
Geelong is scheduled to bear witness to a considerable number of projects and developments one of which is the Spirit of Tasmania which will be moved to the Geelong Port by the end of 2022.
Spirit of Tasmania made the announcement last year that it would be moving its Victorian port operation from Station Pier, Port Melbourne, to Corio Quay, Geelong under a 30-year lease.
Apart from imminent hiring of labourers for construction, this project will also be creating a good number of jobs during the port operations. It will also result in increased tourism and business growth for several industries.
Spirit of Tasmania Relocation and Expansion
Operated by the TT-Line, the iconic Spirit of Tasmania will embark on a long-term partnership with the Geelong Port with the former’s vessels relocating to Corio Quay in Geelong in 2022.
The 12-hectare purpose-designed terminal will include:
- Comfortable and connected passenger lounge areas
- Children’s play area
- Pet exercise area
- Dedicated passenger drop-off and long-term parking
- Crew and staff car parking
- Dedicated berth for Spirit of Tasmania vessels
- Office facilities and crew accommodation
- Flexible storage and expanded facilities for freight clients
With Melbourne commute and travel time not being an issue for residents of Geelong, the suburb has become a viable option for the Melbourne workforce to live in. To make things even better, the Federal Government will be spending a significant amount on improving the rail services for the Geelong Fast Rail. This project, an upgrade to the Melbourne-Geelong rail corridor, will reduce travel time and improve public transport options for commuters.
Geelong Fast Rail Project
Currently in its planning stages, the Geelong Fast Rail project will upgrade the rail corridor to enable faster passenger rail services from Melbourne to Geelong.
The benefits and upgrades set to happen with this project include:
- Construction of a new dedicated regional passenger track from Werribee to Laverton
- Upgraded stations at Werribee and Laverton
- Upgraded train control systems
- Reduced travel times
- Opening of regional centres such as Ballarat and Bendigo
2. Job Opportunities
The proposed plans and projects in place for Geelong will be bringing a host of job opportunities for various members of the Geelong community. With The Spirit of Tasmania transfer and expansion, at least a hundred jobs will be made available in its initial stages alone. The Geelong Fast Rail project, which is scheduled to commence in 2023, will also be creating several employment opportunities.
Other places that offer a good number of employment opportunities located within Geelong include:
- Epworth Hospital
- TAC (Transport Accident Commission)
- Federal Mills
- Worksafe Victoria
Geelong’s population is forecasted to further swell to 268,984 this year. The Geelong population growth rate has been consistently rising through the years, adding over 1,500 to 3,000 people each year to the overall population. Migration has been the key driving force in Geelong’s population growth with a lot of workers taking advantage of the many employment opportunities opening up in the region, plus more affordable housing compared to Melbourne. With education being a primary consideration for families, Deakin University, perched right on the seafront in the heart of Geelong, is a prestigious, 5-star rated university internationally renowned for its research and teaching. Geelong is fortunate to host to a number of good quality schools and training centres such as Belmont High, Geelong College, Kardinia International College, North Geelong Secondary College, and The Gordon Institute.
How Does Geelong Stack Up?
Geelong has been an emerging city with the rate of homebuyers growing stronger since last year. Lifestyle, affordability, and an easy access to the surf coast have beckoned migrations to Victoria’s second-largest city since the first wave of property value growth between 2015 and 2019. Real estate agents have predicted that this demand for properties will only continue. A surprising 9.3% rise in the median house price in the Greater Geelong was recorded December of last year (at $601,000) from the previous $550,000 in December 2019.
Investors are now storming back into the property market. The loan commitments for investors was reported to have soared by 9.4% through March 2021, presenting a staggering increase of 22.7% over the year. Investors appear to have become more confident only months after the lockdowns. It could as well be noted that investors had held back funds from last year also due to the lockdowns.
In the auction results from 23 May 2021, Geelong presented a clearance rate of 80%, with a total of 45 auctions, 36 of them, cleared. Auction activity is expected to remain relatively steady but currently, with lesser homes going to auction.
Where Should You Invest In Geelong?
Armstrong Creek, Grovedale, Herne Hill, and Newcomb are considered some of the key suburbs in Geelong to watch this year. Geelong started the year coming off strong with its high capital growth rates, and is believed to continue to push upward.
Armstrong Creek was named a must-watch suburb as its value continues to rise.. At just 30% developed, this young Geelong suburb is expected to provide housing for up to 65,000 people upon its completion of 22,000 residential homes. A new Neighbourhood Activity Centre will open this year in Armstrong Creek, as well as a new Men’s Shed and park. Armstrong Creek’s appeal lies in its convenient coastal access, local infrastructures such as schools and health services, and its housing market’s relative affordability. Armstrong Creek’s median house price is $580,000.
Grovedale is an inner city suburb and is mainly residential. Growth rise is at 3.6% with Grovedale’s current population at 14,308. A nice, peaceful area, the suburb is close to all amenities and recreational facilities. The median house price in Grovedale is $495,000.
Herne Hill is popular among first-home buyers due to the relative affordability of its housing prices. Considered to be an up and coming area, Herne Hill is a quiet and peaceful suburb located close to amenities and new developments in the region, and is witnessing a noticeable gentrification. The current median house price in Herne Hill is $614,000.
Newcomb is a popular residential suburb considered by most for its affordability, and also for its close proximity to the city. Newcomb is approximately a 5-minute drive to the South Geelong train station. The current median house price at Newcomb is at $472,000
A Geelong Success Story
Back in 2018, Matthew Pennacchia got in touch with Reventon and purchased his first property in Geelong. Due to high capital growth in the area, he was able to use the equity built in his first property to secure a second property in 2019 (which will settle any day now!).
Interested In Investing in Geelong? This Is Where We Come In!
Overall, the Australian property market looks steady for 2021 with the predictions for the succeeding year coming out positive as well.
Currently, Geelong is gaining much attention from home-buyers and property investors. With its affordability, promise of a great lifestyle, and with its diverse range of properties, the demand for housing in Geelong will only get stronger in the coming days.
With Reventon, you are guaranteed a well-researched report on your target areas that include industry growth and job opportunities and other factors affecting growth. Our property advisors go through market trends, reports on future investments in infrastructure, population forecasts and local developments to shortlist areas to provide you with expert advice on your property investment.
The right property in the right location is the investment you want to make.