
New research has revealed that long-term property ownership remains crucial for achieving substantial capital growth, with some locations significantly outperforming others over the past two decades.
The Property Investment Professionals of Australia (PIPA) analysed Australian Bureau of Statistics data on established median dwelling values from June 2004 to June 2024.
The study found that the top-performing location recorded growth of 233 per cent, compared to 100 per cent for the lowest-performing area over the 20-year period.
PIPA Board Director and former Chair Peter Koulizos, who conducted the research, said the results demonstrated property’s stability as a long-term investment, with location being a key factor.
“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,” Mr Koulizos said.
The Rest of Tasmania emerged as the top performer, with its established median house price rising from $169,000 to nearly $449,000 over the past two decades.
Among capital cities, Adelaide, Hobart, and Brisbane were the best performers, all of which were considered relatively affordable throughout the period.
Mr Koulizos noted that property markets are not linear, with price growth occurring at varying points over the years.
“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,” he said.
In comparison, the S&P/ASX 200 increased by 120 per cent over the same period, according to investing.com.
PIPA Chair Nicola McDougall highlighted the challenges faced by property investors, including higher holding costs, changing tenancy legislation, and 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.
The survey also revealed that about 17 per cent of investors who sold had owned their properties for less than three years.
Darwin and the Rest of NT were identified as the poorest performers over the past 20 years, with established median house price growth of 136 per cent and 100 per cent respectively.
Ms McDougall noted that while these markets remain affordable compared to much of the country, their economic fundamentals have been weak over the years.
However, she pointed to new Northern Territory government initiatives aimed at addressing the region’s population issues, which could positively impact property prices in the future.