Melbourne's best investments

Details

Created on Saturday, 12 November 2011 14:24

Written by Greville Pabst, Chief Executive Officer - WBP Property Group

Melbourne’s auction market tendered a stable performance in the June quarter, recording an estimated clearance rate of 55 per cent. But as stock levels and confidence begin to increase mid-spring the market is set to become a great deal more active.

Irrespective of whether you’re buying as a homeowner or investor property is a long-term investment that requires due consideration. But with thousands of properties set to hit the Melbourne market in the coming months, which ones make the best investment choices?

Using the REIV’s September Melbourne median house price of $551,000 as a rough budgetary guide, here are my top tips for the city’s best property investments. 

North
In Melbourne’s north, suburbs such as Coburg and Pasco Vale offer a good supply of well-located 1930s and 40s houses for between $550,000 and $700,000. The area is becoming increasingly popular with a new generation of young professionals, which is leading rejuvenation of the area. Located less than 15kms from the Melbourne CBD both suburbs offer rail services and are good options for those seeking a house within only minutes of the city.

East
Melbourne’s highly desired and subsequently less affordable eastern suburbs offer limited opportunities to purchase a house at the half-million dollar range. Historically, this region of the Melbourne market has been the city’s best performer with values rising strongly in the last decade. Buyer’s thinking of purchasing in this area of the city may wish to consider a two-bedroom flat in well-regarded inner-eastern suburbs Balwyn and East Camberwell. Over the years these suburbs have performed strongly with current median unit values of $555,000 and $631,000 respectively.

South-east
Similarly, the south-east offers comparatively lower affordability than many other areas of Melbourne, leading many buyers in the region to opt for the smaller and more affordable alternatives of units, flats and apartments. The south-east corridor offers sound opportunity to obtain low-density quality 1950s to 70s two-bedroom flats in suburbs such as Toorak, South-Yarra and Armadale from $520,000. Among the city’s best-serviced suburbs these areas offer strong transport infrastructure and good access to the CBD, and have a historical trend of strong capital growth with unit values more than doubling in the last decade. 

Bayside
A little further south, Melbourne’s highly sought-after Bayside offers buyers the chance to purchase well-maintained 2-bedroom 1970s villa units in beachside suburbs such as Brighton from $600,000. For buyers seeking a slightly more affordable option, suburb Mentone provides opportunity to obtain two-bedroom 1970s villa units close to shopping facilities and well-established transport infrastructure for as little as $450,000.

West
While Melbourne’s west has traditionally offered greater affordability than other areas of the city, the disparity between values has reduced significantly in recent years. However, despite increased prices there remains opportunity to purchase small well-maintained two-bedroom houses for just over half a million dollars and only 10kms from the city in suburbs such as Yarraville. Alternately, there is also potential to purchase unrenovated townhouses or villa units in revitalised neighbouring suburbs Spotswood and Newport from $450,000.

When undertaken correctly property investment can be very rewarding. But be warned, not all property is a good investment. When considering where and what to buy consider your individual circumstances and consult an independent professional with local knowledge and expertise.