The economic impact of the Bendigo hospital has helped house prices in the city grow.
Median house prices rose steadily in light of greater dwelling demand as the hospital project was completed.
The median house price reached $350,000 in March 2017 before easing slightly to $334,000 in June according to the 16th QBE Australian Housing Outlook report.
QBE Lenders' Mortgage Insurance chief executive Phil White said house prices are expected to plateau and only rise slightly in the next three years according to report findings.
“The hospital construction helped (Bendigo’s) economy keep ticking along. Infrastructure is critically import for smaller towns (around regional centres),” he said.
“Over the next three years we forecast (house prices) to further improve by 4 per cent and a steady house price market enables people to buy. (A median house price) of $350,000 is projected for Bendigo and is the most attractive in Victoria.”
The report said the next phases in the Bendigo hospital development were smaller scale works that were not of ”comparable size to maintain local economic growth and job creation”.
“Without any significant economic drivers emerging, house price growth in the Bendigo market is expected to be limited at 3 per cent in 2017/18. Growth is then expected to be flat with the median house price at $350,000 in June 2020 representing a total 5 per cent increase,” the report said.
Bendigo’s median house price of $334,000 is only slightly behind Ballarat ($340,000) but a long way from Geelong’s median house price of $475,000.
In the rental market, Bendigo’s vacancy rate remains tight, below the 2 per cent mark, which suggests that rental dwelling demand remains strong.
Melbourne’s median house prices are expected to rise by 10 per cent to $940,000 in June 2020.
“Victoria has done very well in supporting its major regional cities, so it is no surprise (the market) is performing very well,” Mr White said.
“The population growth in Victoria is extremely strong, which is a real positive.”