Regional NSW is emerging as a standout option for homebuyers seeking affordability and lifestyle, with new analysis suggesting buyers can still secure family-sized homes in growing regional centres for less than the cost of many metropolitan properties.

The latest Month in Review report from Herron Todd White highlights a widening divide in Australia’s housing market, with affordability pressures forcing many buyers to compromise on land size, dwelling quality or location in major cities, while regional markets continue to offer comparatively strong value.

The April 2026 report examines the theme “Champagne Location on a Beer Budget”, exploring what buyers can realistically purchase in highly sought-after locations when budgets are constrained.

Across Sydney, many buyers are being forced to choose units instead of houses, purchase properties on busy roads or take on renovation projects to enter desirable suburbs.

Nationally, Herron Todd White director Perron King said the housing market had become increasingly fragmented.

“What looked set to be a year of modest but steady growth has given way to a more cautious outlook,” Mr King said.

The report notes that first-home buyers remain one of the strongest market segments, driven by concerns that housing could become permanently unaffordable and supported by government incentives. Chronic housing undersupply is also helping to support prices despite higher interest rates and economic uncertainty.

For regional NSW, the report points to centres such as Tamworth as examples of markets where buyers can still access large blocks and modern family homes at relatively affordable prices. In the rapidly growing suburb of Moore Creek, about six kilometres north of Tamworth’s CBD, buyers can secure modern five-bedroom homes on blocks exceeding 1000 square metres for around $1 million. The area is also benefiting from new commercial development, including a supermarket, medical facilities and retail services.

The report’s national residential property clock places Dubbo among markets approaching the peak of the cycle for unit values, alongside centres including Tamworth, Coffs Harbour and the Gold Coast, reflecting ongoing demand across regional Australia.

Herron Todd White said softening conditions in some metropolitan markets, combined with emerging value opportunities in regional centres, meant buyers prepared to compromise strategically could find quality locations without paying premium-city prices.

While regional housing markets continue to show resilience, Herron Todd White chief executive Peter Maloney said broader economic pressures were beginning to influence property markets across Australia, including regional and rural NSW.

Mr Maloney said the Reserve Bank’s recent interest rate increases, combined with global uncertainty stemming from conflict in the Middle East, were creating a more challenging environment for both property buyers and agricultural producers.

“Australia’s rate environment is anything but settled,” Mr Maloney said, noting inflation remained above the Reserve Bank’s target range and further rate rises were possible.

Despite those challenges, he said chronic housing undersupply continued to underpin residential markets across much of the country, helping to offset the impact of higher borrowing costs.

The rural outlook is more mixed. Mr Maloney said higher fuel and fertiliser costs linked to ongoing instability in the Middle East were placing additional pressure on farming businesses ahead of key planting periods.

“The conflict in the Middle East remains a meaningful driver,” he said.