Price Trends & Investor Hotspots in Ballarat LGA

Ballarat is the largest city of the Central Highlands of Victoria and is the third largest inland city in Australia. Ballarat first came to prominence as a gold boom town in the 1850s. The wealth of the mining industry is reflected in the fine historic buildings in the city centre. At a distance of around 120 km from the centre of Melbourne, Ballarat property market offers commuters a cheaper alternative to big city living. The typical house price here is just shy of A$474,000, which compares to:

The city is also a centre of commerce in its own right, offering plenty of local employment opportunities. This economic duality means that the local housing market has always been successful.

The Ballarat City local government area (LGA) covers a large area of countryside to the north east of the urban area of Ballarat as well as the city itself. This makes the LGA a very mixed environment. As a semi-rural area, the property market in Ballarat City is dominated by houses, with much smaller demand for units. The occupancy of houses is fairly equally split between ownership and rentals.

Ballarat LGA Heatmap for Houses

As can be seen clearly on the HtAG property map, Ballarat City and all of its neighbouring LGAs have more successful property markets than the urban area of Melbourne in terms of recent typical price growth in years 2019-2020.

How do Greater Melbourne property markets compare?

A number of suburban LGAs in the Greater Melbourne urban area experienced year on year (YoY) price falls of more than 7 percent (Mooney Valley CityMoreland City, and Darebin City) in the 1st quarter of 2020. At the same time, typical house price in Ballarat City property market rose by 5.49 percent. Whilst the neighbouring LGAs also showed similar trends:

  • In Hepburn Shire, immediately to the north west, prices rose by 5.86 percent YoY and
  • the LGA’s neighbour to the south west, Moorabool Shire, had a rise in the typical house price of 5.6 percent YoY.

Both of these neighbouring areas have much higher house prices than Ballarat City with the typical price in Hepburn Shire being A$629, 797 and the typical value in Moorabool Shire being A$585,574.

Ballarat LGA Heatmap for Units

The property market for units in Ballarat City is much smaller than the market for houses, with a lower typical price (A$213,195) and slower price growth (2.61 percent YoY). Within the commuter belt of Melbourne, that price growth rate isn’t as spectacular as some other areas equally distant from the centre of Melbourne, such as 

However, the LGA’s unit market is much safer than areas closer to the city, such as

Demand by Dwelling Type

Demand for both houses and units in the sales and rental sectors in Ballarat is very high compared to national averages. Strong house price growth has outstripped rental price growth, causing rental yields to fall over the last year.

Ballarat Property Type Demand Profile
Three bedroom houses are the dominant dwelling type in Ballarat City LGA

Three bedroom houses are the most in demand property type in Ballarat City. The HtAG Demand Profile for the LGA shows this very clearly. Unit sales numbers only exceed the sales volume for houses in the one bedroom category.

Housing Market in Ballarat Council Area

The typical house price in Ballarat property market has never fallen – as can be seen in the forecast chart below. Although many LGAs in Australia face challenges over the next two years, HtAG forecasts show that house prices will continue to rise in Ballarat City.

The typical house price is currently at an all-time high of $470,000 and that is expected to rise to A$530,000 by Q4 2021 – a 12.8 percent price rise over two years. House sales volumes peaked in Q4 2017 at 570. After falling steadily over the next four quarters, sales turnover dropped dramatically in Q1 2019 down to 230 sales in Q1 2019. House sales volumes have been rising steadily through 2019, reaching 360 sales in Q4. HtAG expects volumes of house sales to continue to rise, reaching 400 sales per quarter in Q4 2021.

Ballarat Median Prices for Houses
May 2021 Update: HtAG Analytics revised data curation method for LGA house prices, which are now calculated as an average of all suburb typical prices in the area.

Ballarat Rental Market for Houses

The rental sector is currently experiencing its greatest volume ever, with 600 contracts signed in Q4 2019. HtAG sees the rental sector’s turnover increase slightly to 610 rentals in Q2 2019 and then staying at that level through to Q4 2021.

Rent levels have risen steadily over the years except for a slight dip in Q4 2019. Rent prices had been at A$330 for 11 quarters up to that point, but fell to A$320 and stayed at that level until Q1 2017. After getting back to A$330 in that quarter, prices have risen steadily up to A$360 in Q1 2019. HtAG forecasts show that median rent levels should continue to rise to A$400 in Q4 2021. Although this is strong growth, at an increase of 11 percent, it is a little lower that the forecasted typical price increase over the same period. So, the rental yield for houses in Ballarat City should drop slightly over the next two years.

HtAG’s bedroom-level forecasts are currently using a beta model source, so expect these forecasts to be revised once the model is fine-tuned by our data science team.

Growth Rate Cycle for Ballarat Houses

The market cycle graph below emphasises that typical house sale prices have never fallen in Ballarat City. The lowest point on the graph in 2014 represents an annual price increase of 1.74 percent. As can be seen, price increases have escalated dramatically since 2016. Prices have increased at the beginning of 2020.

Ballarat Property Growth Rate Cycles for Houses
May 2021 Update: LGA GRC charts now show YoY Typical Price change

However, the figure for this year only includes January 2020. So, this lower price increase for the year is not yet indicative for the year as a whole. The red line represents a forecast and it can be seen that the price increase for 2021 is expected to be at 6.68 percent. It is likely that once all of the figures for 2020 have been recorded, that dip seen at the end of the graph will disappear.

Suburb Capital Growth Heatmap for Ballarat Houses

The heat map shows price movements in each district within the LGA. The initial map for this report showed red areas that had price drops. In this map, the scale is different. No colour denotes price falls. A red area experienced a price increase of between zero and two percent.

The worst performance in Q1 2020 occurred in the Brown Hills housing property market, which saw price growth of 0.76 percent over six house sales. Mount Helen Houses saw the second smallest price rise at 1.988 percent – also over six sales. The biggest house price gains occurred in Newington Houses, where prices rose by 9.98 percent, but calculated over just two house sales. Following on from Newington Houses in the price gain chart were Sebastopol Houses and Black Hill Houses with 9.66 percent and 8.91 percent respectively. While Black Hill Houses had only two sales in Q1 2020, Sebastopol Houses had 19.

Ballarat Capital Growth Heatmap for Houses

The areas with the largest and smallest price gains in Ballarat City are not in specific geographical areas but are interspersed around the LGA. So, it isn’t possible to say whether one side of the LGA is more successful than another. Distance to the centre of town also doesn’t seem to have any influence on price performance. Therefore, the magnitude of price gains seems to more influenced by the features offered for individual properties rather than their location.

The scatter plot below shows all of the sales in the past year and their prices. The south west of the LGA contains almost all of the sales. This is to be expected because that cluster of sales is located where the city is positioned.

Ballarat Scatter Plot for House Sales

The rural areas outside of that cluster is less densely populated and so has few houses for sale in each year.

Unit Property Market in Ballarat City Council

The typical price for units in Ballarat City is under half of the typical price for houses. However, the median rent for units in the area is two thirds that for houses. That means buy to let investors would get higher returns on their investment by specialising in units.

There are far fewer units in the LGA than houses and the rental market for units is much bigger than the sales market. Sales volume peaked in Q2 2018 at a level of 51 sales. From that point, sales volumes declined every quarter to 15 sales in Q1 2019. Since then, sales have improved a little up to 28 sales in Q4 2020. HtAG forecast expect that sales volume of units will continue to recover up to 31 units in Q4 2021.

Since the beginning of 2008, the typical price of units has only ever fallen in one quarter – Q1 2014. That dip took the typical price down from A$180,000 to A$170,000, but the typical unit price was back up to A$180,000 in the next quarter. Since that time, the typical price has risen to A$210,000. HtAG expects that prices for units in Ballarat City will continue to rise, reaching A$220,000. That rise isn’t exactly spectacular, however, the property market in Australia is expected to go through a downturn over the next two years, so any gains represent a big win.

The drop in unit sales in Q3 2018 reflects a national trend. The constant rise in unit rentals is also typical of the property market across Australia. Unit rental volumes in Ballarat City hit an all-time high in Q4 2019. HtAG forecasters see this as a peak level. They expect that rental volumes will fall quarter-on-quarter down to an estimated 81 unit rentals in Q4 2021.

Price Trend for Unit Sales and Rentals

Ballarat Median Prices for Units
May 2021 Update: HtAG Analytics revised data curation method for LGA unit prices, which are now calculated as an average of all suburb typical prices in the area.

Unit rental prices have risen steadily and slowly over the years up to a median of A$220 per month in Q4 2019. HtAG forecasts indicate that price will continue to rise from this point on, reaching A$240 per month at the beginning of 2021 and staying at that level up until the end of 2021.

The market cycles graph for unit sales in Ballarat City shows the percentage change in price levels since 2008. As you can see, the one and only dip in typical price in 2014 appears where the line drops below the zero line.

Ballarat Property Growth Rate Cycles
May 2021 Update: LGA GRC charts now show YoY Typical Price change

The red part of the line represents forecasted unit price changes and they show a slight increase, but not as pronounced as the big rise that occurred in 2019.

Suburb Capital Growth Heatmap for Units in Ballarat City

The area heat map for the LGA only includes those zones where unit sales occurred in the last quarter. There are only four. None of the zones experienced price falls and all sales were of properties in the urban area of the LGA. Four sales took place in Savastopol Houses and three sales were completed in Wendouree Units.

Ballarat Suburb Heatmap for Units

Two sales completed in each of Ballarat Central Units and Redan Units. The smallest price rise was seen in Redan Units at an increase of 0.9 percent. The highest typical price rise happened right next door in Ballarat Central Units.

The scatter plot below shows that all unit sales in the past year occurred in Ballarat City proper. However, this is to be expected because units are rare in rural areas.

Ballarat Units Sales Scatterplot

Conclusion

Ballarat City is in a lucky position. It has a buoyant local economy and is also within commuting distance of Melbourne. Both rental and sales prices in the area are accessible despite high levels of work opportunity, which would ordinarily force prices higher.

Prices will continue to rise despite the general property price downturn across the country, which has already started elsewhere. Ballarat property market is a safe place to invest in; the buy to let market for units in Ballarat City is particularly attractive.

3 thoughts on “Price Trends & Investor Hotspots in Ballarat LGA”

  1. In January 2021 HtAG Analytics introduced a change to LGA price calculation method. Whereas previously LGA prices were calculated using a data fit procedure on all sales recorded in the council area (LGA), the new method takes an average of all suburb typical prices within the LGA.

    This resulted in minor upward shift to historical typical prices for Ballarat LGA, however the general trend and the forecasted capital growth metric remain unaffected.

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