Investors have indicated they will move into Geelong’s most affordable suburbs in 2026

Geelong is said to be the destination for Victorian investors in 2026, joining Ballarat and Melbourne’s coastal enclaves as top picks for next year.

Property Investment Professionals of Australia chairman Cate Bakos has named two of Geelong’s most affordable properties among her top picks for investor buyers.

Herne Hill and Grovedale made the list, along with Melbourne areas such as Oakleigh, Lilydale, Lalor, Elsterwick, Williamstown, Brunswick West, Mount Waverley and Ballarat East.

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The Katos family is selling a Victorian-era home

Big change for the real estate market in 2026

Ms Bakos said much of Victoria had recovered for several months after a slump in previous years, although it had shown slow growth so far.

But with other parts of the country rising sharply in the past few years, the state was starting to look like it could hope for a broader increase in 2026.

“There has been a lot of recent demand from investors in Victoria and it’s a value proposition,” Ms Bakos said.

“But you need to be selective. A lot of people are looking for a low-cost house in some of the areas to get the lowest social and economic rates – and they’re going to have challenges.”

Noting that following the crowd in these areas can be “dangerous”, Ms Bakos said it is possible that investors will overtake shareholders and distort local markets and that could lead to property bubble situations.

Property Investment Professionals of Australia is chaired by Cate Bakos.

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He said Herne Hill was a good proposition, with good character homes and a median house price of more than $700,000.

“West Geelong has continued to thrive and Herne Hill is just behind Manifold Heights, which has worked well for Geelong’s post-Covid recovery,” he said.

“My favorite thing about Herne Hill (besides the beautiful houses there) is the railway; the old disused railway is now a peaceful route through the parks.”

Grovedale has seen a surge in investor activity in the latter half of 2025, as affordable older homes and large block developments have proved an attractive combination.

“Grovedale’s median house price of $675,000 makes family homes affordable in an established area south of Geelong,” Ms Bakos said.

A reformer’s delight at 5 Wirksworth St, Herne Hill, sold for $595,000 in December.

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Ray White, Highton agent Ben Powe said the bulk of Grovedale’s listings were being sold by solicitors representing interstate investor clients.

But he said this puts pressure on first-time home buyers who are competing for properties of the same standard.

“At the moment I would say, like, houses are bought more in Grovedale than Highton,” said Mr Powe.

“If it’s a four-bed, two-bath, ’80s-built house in Grovedale it seems to pay a lot, which I’ve never seen.

“About 50 percent of the buyers are attorneys and the majority of them are chasing those who buy houses first and pay big dollars.

This four-bedroom home at 156 Grove Rd, Grovedale, is listed with an asking price of $680,000-$740,000.

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“I think they like all the facilities around Waurn Ponds, the train station, Deakin, Epworth, the shopping centre.”

Property analyst Terry Ryder, founder and managing director of Hotspotting, said major infrastructure investment is often a precursor to rising consumer demand and prices.

“It creates job opportunities and from that comes the demand for real estate,” he said.