Bendigo Property Market Faces Growing Headwinds Amid Population Boom and Rising Sales

Bendigo’s residential property market recorded significant sales growth in the second quarter of 2025, with house sales surging 48.6% to 382 transactions and unit sales climbing by 30.4%. However, this robust activity masks underlying challenges that threaten to constrain market momentum through the rest of the year.

The median house price in Bendigo stood at approximately $600,000 in Q2 2025, reflecting annual price growth of 6.2% for houses and an even stronger 14.5% for units. These figures highlight considerable buyer interest despite ongoing headwinds such as higher interest rates that typically cool demand.

Demand Outpaces Supply, Tightening Rental Market

The local property market is currently classified as 'neutral' yet presents a weak Demand Supply Ratio of 39.0, indicating supply struggles to keep pace with buyer interest. This tension is especially pronounced in the rental market, where many Bendigo suburbs report vacancy rates below 1%, underscoring a critical shortage of rental properties.

This persistent rental tightness means that investors and buyers are competing for a shrinking pool of available homes, which supports price resilience. Yet, it also stifles options for tenants and complicates affordability in an already fast-moving market.

Population Growth and Economic Backdrop Add Pressure

Bendigo's population grew by an extraordinary 20,135 residents over the past year, a 2.22% annual increase. This surge is paired with a healthy local job market, characterized by an unemployment rate around 4.3% and high job availability. Such demographic and economic factors further amplify demand for housing across the region.

This population expansion underlines the city's rising profile as a regional centre and fuels the need for continued residential development. However, while construction and commercial projects in Bendigo have increased, with over $1.6 billion planned to commence between 2024 and 2026, new housing supply has not matched the pace of demand growth.

Market dynamics from late 2024 through Q4 2025 reveal that vendor discounting has tightened, with average vendor discounts for houses dropping to -2.4%. Still, the market nominally favours buyers where sellers accept below-list prices, indicating some negotiation room persists despite competition.

Experts note that Bendigo's combination of escalating population and constrained supply means sellers remain cautious but optimistic. Buyers, on the other hand, face the dual challenge of navigating rising prices and limited stock availability, particularly in popular suburbs where rental vacancies hover below 1%.

Looking forward, prospective buyers and investors will need to closely monitor supply-side developments, including new housing construction approvals and commercial-to-residential conversions within Bendigo. Renters may face ongoing pressure due to scarce vacancies, and affordability considerations are likely to influence market behaviour over the coming months.

This article is general information only and is not personal financial or investment advice. Consider your own circumstances and seek licensed professional advice before making financial decisions.