Fastest growing regional areas for property investment in 2026

Are you considering investing in a regional property market in 2026?

Regional Australia continues to offer exciting opportunities for investors and homebuyers alike, with many areas seeing strong growth and affordability compared to major cities. This guide breaks down how regional property markets performed across the country in 2025.

Let’s dive into the big picture of how regional markets are shaping up and what trends are driving their performance.

How did regional markets perform in 2025?

Regional Australia defied expectations of a slowdown in 2025, outperforming the capital cities as buyers continued to prioritise value and lifestyle. According to Cotality, the Regional Australia property market as a whole recorded dwelling value growth of +7.5 per cent in the 12 months to October 2025. This result notably outpaced the combined capital cities, which saw a more moderate increase of +5.6 per cent over the same period.

Growth was consistent across property types, with houses maintaining a slight performance edge over units. Regional house values rose by +7.6 per cent to reach a median of roughly $730,000, while the unit market increased by +7.1 per cent to a median of $630,000. This steady momentum was fueled by a widening price gap between metropolitan and regional areas, which encouraged a second wind of internal migration from buyers priced out of the major cities.

Supply levels remained chronically low, intensifying competition among buyers. Total listings tracked approximately 18.0 per cent below the five-year average for much of the year, creating a seller's market in key hubs across Queensland, Western Australia, and New South Wales. Despite the lack of stock, transaction volumes held up well, supported by improved borrowing capacity following interest rate cuts in February.

For investors, the regions offered compelling fundamentals compared to the compressed yields of the cities. Gross rental yields sat at 4.3 per cent in October 2025, supported by vacancy rates that hovered near critical lows of 1.2 per cent. Kaytlin Ezzy, Economist at Cotality, noted that affordability was the primary engine for this trend, stating, "With demand skewing towards the more affordable end of the market, it's not surprising to see value growth shift away from the capitals, towards the regions, as cash-strapped buyers look further afield for more affordable markets."

What are the fastest-growing regional towns in Australia?

Cotality's latest Regional Market Update recorded the following regional growth hotspots over 2025:

• Albany, WA: The highest mover of 2025, with annual gains reaching +23.3 per cent.
• Port Augusta, SA: The only other regional location to reach the twenties with +20.1 per cent.
• Geraldton, WA: Last year's biggest regional growth area had another big year with gains of +19.5 per cent. 
• Emerald, QLD: The inland hub saw another strong upswing of +18.0 per cent.
• Port Pirie, SA: Capped off the top 5 list with annual growth of +17.8 per cent.

2025 was undeniably the year of the affordable industrial and resources hub, with regional Western Australia and South Australia dominating the leaderboard to deliver the strongest returns in the country.

Let’s now dial down into specific regions state-by-state.

Top Regional NSW growth markets in 2025

Regional NSW has seen a resurgence in growth momentum over the past 12 months, with affordability acting as a key driver for buyers looking beyond the Greater Sydney basin.

1. Taree / Annual growth: +13.4% / Median value: $531,464

Located on the Mid North Coast, Taree offers river-side living at a highly accessible price point. The area has attracted steady interest from sea-changers and investors, supported by very tight rental conditions with a vacancy rate of just 1.5%.

2. Tamworth / Annual growth: +12.6% / Median value: $565,820

As the major economic hub of the New England region, Tamworth combines steady local employment with a relaxed rural lifestyle. It has remained a standout performer in regional NSW, delivering double-digit growth despite a slight dip in sales volumes over the year.

3. Albury - Wodonga / Annual growth: +10.4% / Median value: $624,300

Straddling the Murray River border between NSW and Victoria, this twin-city growth corridor continues to perform well due to its diverse local economy and strategic position on the Hume Highway. It remains a key target for investors, offering a solid gross rental yield of 4.6%.

4. Armidale / Annual growth: +8.8% / Median value: $525,285

Known for its heritage architecture and the University of New England, Armidale offers one of the most affordable entry points in the state. Its educational and agricultural foundations provide stability, making it appealing to families and investors alike.

5. Medowie / Annual growth: +8.8% / Median value: $906,228

Situated just north of Newcastle in the Port Stephens region, Medowie is popular for its large semi-rural blocks and proximity to the RAAF base. It attracts buyers seeking space and lifestyle without sacrificing proximity to the major employment hubs of Newcastle.

Top Regional Victoria growth markets in 2025

Regional Victoria remains a stronghold for affordability, with major regional hubs consistently outperforming the Melbourne metropolitan area as buyers seek value and lifestyle in established inland cities.

1. Mildura - Buronga / Annual growth: +17.2% / Median value: $527,018

Located in the far north-west on the banks of the Murray River, Mildura is a major agricultural powerhouse known for its vineyards and citrus groves. It was the standout performer for the state by a significant margin, delivering substantial capital gains while maintaining an affordable median price.

2. Bendigo / Annual growth: +9.9% / Median value: $612,638

Famous for its gold rush heritage and grand architecture, Bendigo continues to be a favourite for tree-changers. Its strong transport links to Melbourne, vibrant arts scene, and diverse local economy make it a top choice for those seeking a balance of lifestyle and connectivity.

3. Horsham / Annual growth: +9.2% / Median value: $396,775

Situated in the Wimmera region, Horsham offers incredible value for money with a median price still sitting below $400,000. As a key service centre for the surrounding agricultural district, it provides high rental yields for investors and a low barrier to entry for homebuyers.

4. Ballarat / Annual growth: +8.6% / Median value: $587,222

Like its rival Bendigo, Ballarat offers historic charm and excellent amenities just over an hour from Melbourne. The market here has remained resilient, appealing to families and commuters looking for spacious period homes without the capital city price tag.

5. Shepparton - Mooroopna / Annual growth: +8.1% / Median value: $514,900

Located in the heart of the Goulburn Valley, this agricultural hub saw a massive surge in activity in 2025, recording the highest increase in sales volumes (+44.0%) of any regional market in the report. It combines a strong local economy with affordable family living.

Top Regional Queensland growth markets in 2025

Regional Queensland was a powerhouse in 2025, with eight separate regions recording double-digit annual growth. The top performers were dominated by resource-rich locations and affordable heritage townships offering strong rental returns.

1. Emerald / Annual growth: +18.0% / Median value: $501,219

Located in the Central Highlands, Emerald is a key service hub for the coal mining and agricultural sectors. It claimed the top spot for Queensland growth, likely driven by strength in the commodities sector and demand from investors seeking high-yielding assets in a tight rental market.

2. Warwick / Annual growth: +17.1% / Median value: $553,782

Situated in the Southern Downs, Warwick offers a relaxed rural lifestyle with a rich history and heritage streetscapes. Its relative proximity to Toowoomba allows it to benefit from the larger city's economic ripple effect while offering a significantly more affordable entry point for families.

3. Toowoomba / Annual growth: +15.8% / Median value: $761,458

As Australia’s second-largest inland city, Toowoomba has moved beyond being just a "big country town" to become a genuine alternative to Brisbane. With diverse employment drivers and excellent education facilities, it continues to see strong demand from buyers priced out of the South East Queensland coast.

4. Maryborough / Annual growth: +15.2% / Median value: $537,415

Located on the Fraser Coast just inland from Hervey Bay, Maryborough is known for its historic colonial architecture and manufacturing history. The market here has surged as buyers seek value, with sales activity jumping by more than 32% compared to the previous year.

5. Townsville / Annual growth: +14.4% / Median value: $613,232

The unofficial capital of North Queensland continues to perform strongly, supported by a diverse economy anchored by defence, government, and port activities. With a median price still sitting around the low $600,000s, it remains a highly attractive proposition compared to the southern capitals.

Top Regional South Australia growth markets in 2025

South Australia’s regional markets delivered exceptional returns in 2025, driven by industrial renewal and some of the lowest property prices in the country. The standout performers were concentrated in the 'Iron Triangle' cities of the Upper Spencer Gulf.

1. Port Augusta / Annual growth: +20.1% / Median value: $299,320

Sitting at the top of the Spencer Gulf, Port Augusta was the second-fastest growing regional market in the entire country. Driven by its strategic position as a transport corridor and a developing hub for renewable energy projects, it offers an incredibly low entry point with a median value still sitting under $300,000.

2. Port Pirie / Annual growth: +17.8% / Median value: $320,362

Located just south of Port Augusta, this industrial harbour city followed a similar trajectory. With a history anchored in smelting and industry, Port Pirie has attracted buyers looking for high-yielding investment opportunities and housing prices that are a fraction of the capital cities.

3. Port Lincoln / Annual growth: +15.1% / Median value: $496,546

Known as the "Seafood Capital of Australia," Port Lincoln sits on the tip of the Eyre Peninsula. Unlike the industrial towns to its north, growth here is driven by a mix of lucrative local industries (fishing and agriculture) and coastal lifestyle appeal, commanding a higher median price as a result.

4. Murray Bridge / Annual growth: +13.6% / Median value: $533,826

Situated less than an hour from Adelaide, Murray Bridge has benefited significantly from the ripple effect of the capital city's strong performance. It offers a riverside lifestyle with excellent transport links, making it a viable option for commuters and families priced out of the Adelaide Hills.

5. Whyalla / Annual growth: +11.6% / Median value: $286,861

The "Steel City" rounds out the top five, offering the most affordable median house price on this list. While the market here has historically been volatile, recent optimism surrounding green hydrogen projects and heavy industry has renewed buyer confidence in the area.

Top Regional Western Australia growth markets in 2025

Western Australia was the undisputed champion of the 2025 regional property market. Driven by a booming resources sector and a critical shortage of housing stock, regional WA recorded some of the fastest selling times and highest price gains in the nation.

1. Albany / Annual growth: +23.3% / Median value: $721,253

Albany wasn't just the top performer in WA; it was the number one regional growth market in Australia for 2025. Located on the rugged south coast, it saw incredible demand, recording the shortest days-on-market figure in the country at just 11 days. The combination of lifestyle appeal and tight supply forced buyers to move quickly and pay a premium.

2. Geraldton / Annual growth: +19.5% / Median value: $556,580

Located on the mid-west coast, Geraldton has shaken off years of stagnation to become a coastal boomtown. Offering affordable ocean-side living and supported by port and mining industries, it provides a significantly cheaper alternative to Perth while still offering major city amenities.

3. Esperance / Annual growth: +13.4% / Median value: $521,608

Famous for its white sands and turquoise waters, Esperance is a key port and agricultural hub on the south-east coast. Despite its isolation, the market here has tightened significantly, driven by a lack of rental accommodation and strong local employment, pushing prices up by double digits.

4. Karratha / Annual growth: +12.7% / Median value: $658,818

As the powerhouse of the Pilbara, Karratha’s property market is inextricably linked to the fortunes of the iron ore and gas sectors. With major resource projects ramping up employment, demand for housing in this purpose-built city has surged, offering investors some of the highest rental yields in the state.

5. Busselton / Annual growth: +11.2% / Median value: $1,000,130

The gateway to the famous Margaret River wine region, Busselton is the premium market on this list. It is the only location in the top five with a median value exceeding $1 million. The growth here is driven less by affordability and more by high-end lifestyle demand, boosted by the expansion of the local airport improving connectivity to the east coast.

Top Regional Tasmania growth markets in 2025

After a period of correction, the Tasmanian regional market returned to positive territory in 2025. The north-west coast led the recovery, offering some of the most affordable coastal real estate in the country, while the major northern hub of Launceston saw steady, consistent gains.

1. Devonport / Annual growth: +6.2% / Median value: $505,670

As the gateway to Tasmania for those arriving by sea, Devonport anchors the north-west coast economy. It delivered the strongest growth in the state, driven by its affordability and role as a key logistics and agricultural service centre, all while keeping the median house price tantalisingly close to $500,000.

2. Burnie - Somerset / Annual growth: +5.6% / Median value: $471,058

Located further west along the coast, Burnie offers an industrial backbone with deep-water port facilities. It remains the most affordable major regional centre in Tasmania, attracting budget-conscious buyers and investors seeking higher rental yields in a tight market.

3. Launceston / Annual growth: +4.5% / Median value: $581,091

Launceston has steadily recovered from the corrections of previous years. As the major hub for northern Tasmania, it offers a distinct blend of heritage architecture, city amenities, and proximity to the Tamar Valley wine region, maintaining steady demand from families and mainland relocators.

4. Ulverstone / Annual growth: +3.2% / Median value: $542,324

Sitting comfortably between Devonport and Burnie, Ulverstone is a popular lifestyle choice, particularly for retirees and families seeking a quieter coastal pace. While growth was more modest than its neighbours, it remains a stable market with a strong community feel and scenic riverside location.

Investing in regional property markets

Based on the above you should have a good starting point for researching specific regional markets. Like any location, you need to look at a combination of factors when analysing regional property – including population, economic growth, affordability, rental yield and capital growth.