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Property experts warns of Vic growth killers

Investors chasing cheap houses in regional Victoria could be buying into growth traps, with leading experts warning soaring prices in towns like Mildura and Shepparton may not last. PropTrack data reveals Mildura was the busiest regional market in the state over the past financial year, with 706 homes changing hands. Shepparton was next at 632, then Traralgon, 530, Warrnambool, 473, and Armstrong Creek, 455. RELATED: Surf mad Damien Oliver lists Jan Juc beach shack Shock way Aus home cost hike could lock in rate cut High sales volumes have sparked speculation investor activity is returning to the regions, but experts are urging buyers to tread carefully. OpenCorp chief executive Cam McLellan said regional towns had been distorted by lifestyle demand. 'That's not investment grade growth it's emotional overshooting,' Mr McLellan said. 'Price growth is short lived as long term demand doesn't pressure supply levels.' He said he advises his clients to not invest in regional Victorian markets. 'Selling a metro property with limited new land and strong local jobs to buy into a regional area with cheap land and weaker demand isn't a trade-up, it's a trade-off,' Mr McLellan said. 'Most regional towns have an oversupply of land, that's a long-term growth killer. 'Prices might spike temporarily from lifestyle demand or affordability pressures, but once new land is released or migration slows, growth flattens out.' Mortgage Choice broker Rhys Elmi said while buyer interest was soaring across Victoria, regional investment was becoming harder to justify. Mr Elmi said while some regional buyers were driven by affordability or lifestyle changes, most first-home buyers and investors still aimed to secure houses rather than units, even if it meant compromising on location. 'There needs to be a bit of a mindset shift,' he said. 'Start small, build equity, and turn that first property into an investment later. 'That's how you build long-term wealth.' Regional Victoria Top 20 Suburbs By Sales Volumes Suburb Property Type Number sold 12 months Mildura House 706 Shepparton House 632 Traralgon House 530 Warrnambool House 473 Armstrong Creek House 455 Warragul House 401 Morwell House 370 Wodonga House 363 Lara House 357 Wangaratta House 347 Torquay House 339 Drouin House 330 Horsham House 303 Ocean Grove House 293 Alfredton House 292 Corio House 291 Highton House 276 Sebastopol House 266 Sale House 266 Mount Duneed House 240