Recent real estate data has shown Australian metropolis Melbourne has recorded its lowest increase in house prices in almost two years, rising just 0.7% in September to a median of $817,000.
It’s thought that the modest increase could be down to 44% of all September sales being below the value of $600,000.
The second quarter of the year saw vendors with properties around that price holding back on sales to make the most of rising competition between first-time buyers. And it looks like it worked, as first-time buyers made up 18.3% of all home loans in August, which is the highest value since September 2013.
Although it’s seen a slowdown, the market has stayed strong, with Melbourne’s median prices up 14% on this time last year. Buyer demand is also continuing to overshadow supply, boosting vendor confidence.
The top 20 growth suburbs in this quarter was dominated by Melbourne, fuelled by buyers keen on a reasonable price point for entering the market.
Dromana, the coastal suburb performed best, with median house price increases of 15% to $790,250 in June. Diamond Creek, Sunbury and Ringwood East also experienced double-digit growth in the same quarter.
The market is in a state of strength currently, and as a result, buyers are hungry for the right price point, without having to sacrifice infrastructure or amenities. Increased competition within the city’s outer areas as a result is driving the median house price, with areas known to be the most affordable in the city experiencing significant growth.
The city’s inner ring came out on top in the September quarter, with median house prices increasing by 1.5% to over $1.5 million. Demand for housing within 10km of the CBD has stayed high, a trend that’s being supported by a general housing shortage.
Government initiatives targeted at first-time buyers have also influenced a spark in market demand for apartments in the city, with the median falling by 2.5% across the city to $587,000.
Top 5 Most Expensive Suburbs with September 2017 Median Price
These suburbs ranked among some of the city’s most expensive:
1) Brighton – $2,650,000
2) Balwyn – $2,275,000
3) Camberwell – $2,260,000
4) Hampton – $2,210,000
5) Kew – $2,200,000
Top 5 Most Affordable Suburbs with September 2017 Median Price
Conversely, these areas were reported as some of the city’s most affordable:
1) Melton West – $425,000
2) Wyndham Value – $465,000
3) Pakenham – $490,000
4) Werribee – $490,250
5) Cranbourne – $505,000