Newcastle and Lake Macquarie property prices have surged 9.0 per cent in a year, smashing increases in metropolitan markets as demand for regional homes soars.
Figures from property analysts CoreLogic show the median value of all houses and apartments sold in December rose 1.4 per cent to $610,876 - after prices eclipsed the $600,000 mark for the first time in November.
The median value of houses sold in December was $628,481, up 1.5 per cent from the month prior.
The median unit price reached $519,260, up 0.9 per cent but still 3.9 per cent down on the 2018 peak.
There were 5864 houses and 1519 units sold in Newcastle and Lake Macquarie last year. Median house prices rose 9.6 per cent across the year while median unit prices increased 6.0 per cent.
CoreLogic's research director Tim Lawless said property prices in regional areas of Australia like Newcastle soared in 2020 on the back of remote working opportunities and a demand for lifestyle homes and lower-density housing options.
"Regional housing markets had generally underperformed relative to the capital city regions over the past decade, but 2020 saw regional housing values surge as demand outweighed supply," he said.
In the Hunter Valley, house and unit prices increased 1.6 per cent last month to a record median value of $452,999. Combined prices were up 5.3 per cent across 2020, when there were 6467 houses and 767 units sold.
Nationally, median prices rose 1.0 per cent in December to finish 3.0 per cent higher than a year earlier.
Regional property values rose by 6.9 per cent across the year, a rate of capital gain that was more than three times higher than the combined capitals, where home values were up 2.0 per cent.
The most expensive city was Sydney with a median value of $871,749. Darwin was the cheapest at $416,183.
The Newcastle median property price of $610,876 is higher than in Brisbane ($521,686), Perth ($471,310), Adelaide ($468,544) and Hobart ($513,552).
It is only about $70,000 less than Melbourne ($682,197) and Canberra ($678,765).
CoreLogic's Tim Lawless said nationally the year was characterised by a mild dip in values, but unprecedented volatility in transactions.
"The number of residential property sales plummeted by 40 per cent through March and April but finished the year with almost 8 per cent more sales relative to a year ago," he said.
"Despite the volatility, housing values showed remarkable resilience, falling by only 2.1 per cent before rebounding."
Mr Lawless said prices might decline in coming months as some buyers become wary of the latest COVID-19 restrictions.
"It stands to reason that the latest coronavirus changes will dent consumer confidence and the housing market could be negatively impacted," he said. "We can see when consumer sentiment falls, we see a similar fall in transactional activity."
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