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| Hot Property Feature: Melbourne on the Boil | ||
| There is no doubt that the better positioned suburbs of Melbourne are a good buy. Job prospects are comparable to Sydney, but the average family home is cheaper by 25%, (REINSW, REIV). Perhaps the more astute buyers are realising this, and are behind the current steady rise in Melbourne property values. | ||
| One important factor behind Melbourne real estate being on the up is the number and character of its innovative large scale developments. The multi-billion dollar Docklands renewal project is boosting investor confidence generally. Innovation in this multi-function project ranges from a major international film venue, to commissioning an artist to synchronize lighting effects to the level of crowd enthusiasm, as they cheer in the stadium! |  |
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| The latest release of figures by REIV shows, not surprisingly, that Toorak took the highest median price of $897,000, compared to $852,000 June 98, a rise of 5.3%. On the other end of the scale, the suburb of Malvern showed a slip of 21.2%, down to a still healthy $387,500. The most affordable median prices were to be found at Melton at only $94,000. Of interest is the whopping 80.9% rise in St Kilda, June to June showing a rise from $192,000 to $348,000. | ||
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Melbourne overall showed a healthy rise of 14.1% over the same quarter last year, sitting now at a median house price of $226,000. This is the result of strong employment, says CEO of the REIV Norman Huon, coupled with low inflation. Caution should be shown though, in applying these figures to a yearly trend as they are simply quarterly results. In common with most property markets, Melbourne's residential sales are volatile and fluctuate widely subject to supply. Many Melbourne agents note that at the moment there is a shortage of supply, and this could be a strong contributor to the rise of one area relative to another. |
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| Nevertheless the general mood is upbeat, with the most recent LaSalle Advisory report claiming Melbourne will give a better than Sydney yield in the three year outlook! Hay Property Consultants note a breakdown of this "explosion in the residential property market" as being quite variable for different market areas. In the South East growth has been particularly strong for land in the outer developing areas, period homes in the established suburbs and units/townhouses in the inner areas only. In the Metropolitan North they note "there is a preference for 'private sales'; homes were selling within two to three weeks with minimal advertising and exposure." In the outer Bayside/Mornington Peninsula there has been less of an increase. An exception is in the rural area with 50 acre plus blocks, selling strongly to wine producers. | ||
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The other significant boost to property investor confidence has been the large number of luxury residential projects. This proposed Central Equity tower has already sold 95% off the plan | |
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