Gippsland's property market will be hit and miss in 2017: HTW

Regions of Gippsland will be on the move while other regions stagnate, according to HTW’s February 2017 update.

Discussions with local real estate agents indicate that 2017 has started off surprisingly with an increase in buyer interest and sales, the report says.

The expansion of the East Sale RAAF Base is increasing confidence in the local area.

Rental vacancies in 2016 were at higher than usual levels, but 2017 is showing signs of investors coming back into the market.

"Sale could be the surprise packet of 2017," HTW says.

TRARALGON/MORWELL/MOE

The Latrobe Valley has come through a tough period and the forthcoming closure of Hazelwood Power Station has put some negativity in the market, says HTW.

Morwell seems to be the hardest hit with evidence of pricing at lower levels than 2014 and 2015, however rental returns are still at a high upwards of 8%.

"Traralgon new construction is still in good demand, so whilst there is come negativity, Traralgon may be a good buyer’s market at the moment with some good quality affordable properties on the available."

WARRAGUL/DROUIN

The Baw Baw region continues to grow. New housing is in high demand and land prices have increased in the past six to 12 months.

A lot more workers are commuting to Melbourne and agents are selling properties quickly.

There is evidence of increase in values in short term periods, the report says.

KOO WEE RUP/LANG LANG/NYORA

"These areas have been a real surprise packet, with fast growth and strong demand," says HTW.

Land prices have increased from $180,000 to $240,000 in a 12 to 18 month period.

Cranbourne and Peninsula buyers are becoming more interested in these regions.

Rural residential small acreage parcels in Nyora are increasing in value.

EAST GIPPSLAND

Bairnsdale will see continued average sales volume and demand ahead.

For Paynesville, 2015 was a good year, 2016 an average year and average volume is expected in the year ahead.

Lakes Entrance is showing better than five year average sales volume ahead.

Overall East Gippsland has average to better than average sales volume.

Phillip Island Phillip Island and the Bass Coast has seen relatively stagnant prices over the previous few years.

Predictions for price level growth in this area are regarded as positive with minor price growth over the past six to 12 months, according to the report.

New housing coming on to the market in 2017 on Phillip Island, mostly around Cowes, may limit price growth as supply is seen to be keeping up with demand.

"Recent press and news stories describing the Bass Coast and Phillip Island as affordable beach side living in comparison to other traditional destinations for Melbourne holidaymakers may result in increased demand and could have a positive impact on price growth," says HTW.

"An increase in interest rates is the most concerning factor with a large number of holiday homes and holiday rentals in this locality.

"Demand for a second residence or holiday home may decrease if the cost of borrowing increases."