Getting information from developers, agents and peers via phone call, email and newsletters is a good way for me to keep in touch with what’s going on in the key investment areas around the country, but there’s nothing quite like visiting to get a real feel for what’s actually happening.
And following on from my trip to Melbourne a couple of weeks, I’m really excited about this market, despite the Covid hits that it’s taken recently.
- Melbourne’s dwelling values have now increased by 13.8% since bottoming out in mid-2019.
- The median price across houses is now $736,478 and units $593,121.
- Melbourne continues to outperform other cities as the most profitable capitals for sellers (94.3% in Q1 2021).
- Buyer activity has risen rapidly, with Corelogic estimating the number of settled dwellings sales over the past three months was tracking 38% higher than a year ago.
- In its stride towards economic recovery, Victoria has announced $19.6 billion to be spent each year until 2024. This includes the $2.2 billion for the Suburban Rail Loop and $2 billion towards Geelong Fast Rail.
The real bonus for investing in Victoria is a stamp duty waiver of 50% for new residential properties is available for purchases of up to $1 million on contracts entered until 30 June 2021. This is the only government incentive available for investors across the country.
Vacancy rates are high in the CBD, mainly due to the loss of international tenants, but if we move out of the CBD and into the house market instead of apartments, the numbers are much better with a prospect for further improvement in both demand and capital gain.
On our road trip, we viewed a lot of properties and I’ve included my top picks below. They’re quality developments in areas that are targeting young couples, families and downsizers. They have a high percentage of owner-occupiers and they’re in locations that are primed for growth and meet all our selection criteria.
As far as expert opinions go on investing in Melbourne:
- Westpac has forecast Melbourne dwelling values will rise 10% in 2021 and 2022, with the market moving into a sustained boom.
- ANZ expects Melbourne house prices to lift by 16% over the course of the year.
- Tim Lawless, Head of Research for CoreLogic has stated, “It was only a matter of time before the recent strong gains in housing values led Australia’s second largest city to move to record highs. Following a decline of 6.1% through Covid-19, values have since grown by 6.7% and are now sitting 0.2% above their recent high record on April 6, 2020.”
All in all, with the right properties, in the right locations, things are looking good for Melbourne investors. Let me do the research for you and find the property that matches your goals.