The average price for a three-bedroom house in the Warrnambool region hovered between $310,000 and $340,000, according to most agents, with house prices cheaper in smaller south-west towns.

Vacant blocks varied wildly in price over the calendar year with the cheapest block going for $50,000 while the most expensive was a clear site with panoramic views that sold for $295,000.

Brian O’Halloran agent Brian Hancock said a lack of business confidence nationwide had permeated most aspects of the real estate sector.

He said there had been some improvement in the last quarter of 2013 but the commercial sector still needed a rise in consumer confidence.

“Warrnambool is still going along quite well,” Mr Hancock said.

“It’s always been a solid market for real estate. 

“The commercial side of things is still excessively slow, there’s more empty shopfronts around the CBD than there has been in quite some time. 

“Business confidence still has some way to go.”

PRD Jens Gaunt land sales manager Jeff Nesbitt said housing in Warrnambool was still a solid investment despite a volatile residential market in the state capitals. He said low interest rates meant 2014 was the easiest year for home buyers in more than a decade.

“It’s been an up and down year, that’s for sure,” Mr Nesbitt said.

 “The federal election gave people who wanted to be cautious a reason to be cautious but I think confidence is starting to return to the market for whatever reason.

“The average block of land is about 765 square metres in Warrnambool, which is far larger than Melbourne and a number of other regional centres.”

Wilson Real Estate director Matthew Wood said sales had been steady throughout 2013 but the past month had proved to be far stronger.

He said the trend was reflected at a national level as the Australian economy finds its feet after a difficult 12 months.

“We speak to agents across the country and they were reporting this positive change in September and October,” Mr Wood said. 

“It looks like it’s starting to filter through in time for the new year. The last two months have been really exciting for us and between Christmas and New Year’s we’ve had a sale every day.”