There was still a lot of population growth in Victoria and Melbourne’s property market showed a growth of 10.10 % up until November 2017. According to the Australian Bureau of Statistics, Victoria had an annual population growth of 2.3 % for the year up to June 2017.
There has also been healthy job growth in Victoria which relates to more people looking for accommodation, especially if they’re moving from interstate or overseas. It is noted however, that in Melbourne especially, houses outperformed units in both capital growth and rental returns.
Of course, all this growth translates into higher property prices for investors with the median house price for properties in and around the city of Melbourne being over $1 million dollars.
The good news for investors is that there still appears to be a high demand for rental properties due to the influx of new residents from both overseas and interstate.
Which Suburbs Had The Highest Property Price Growth In 2017?
The outer suburbs southwest of Melbourne had strong property price growth last year. These include Altona and Hoppers Crossing (up by 40%). Sunbury which is just north west of Melbourne also sustained a steady growth in prices (up by 14.5%) as did Dromana which is situated on the ever popular Mornington Peninsula (up by 15%).
Closer to Melbourne, Balwyn North showed a growth of 13.8 % in property prices.
Units in and around Melbourne showed even high median price growth with the most prominent being Moonee Ponds (up by 26.2%), Bundoora (up by 27.7%) and Northcote (up by 26.3%).
So What Regions Should You Be Looking At In 2018?
It appears that regional cities which are close to Melbourne are being looked at very favourably by property investors. These areas have all the necessary infrastructure such as good transport, more employment opportunities and properties which are much more affordable.
Geelong is Victoria’s second largest city and is located just 75 kilometres south west of Melbourne which equates to an easy commute for people working in or around the CBD. Located on Port Philip Bay, it offers a pleasant lifestyle close to many popular beaches and holiday spots.
The population of Geelong was recorded as 224,926 in 2014 and this is predicted to rise by 1.5% per annum by the year 2031. This city also has its own international airport at Avalon as well the Port of Geelong which is Victoria’s second largest port.
The median house prices in Geelong are around $735,000 with median rents around $395 per week. While this may not equate to a positive cash flow for some investors, the rental demand is high and is predicted to stay that way for some time yet.Market Demand Graph
If you’re looking for a more affordable option and a property which is likely to return a positive cash flow, you might want to consider buying an investment property in Ballarat, especially Ballarat East.
Ballarat is the largest inland city in Victoria and has a rich history thanks to the Victorian gold rush. It’s located just 110 kilometres north west of Melbourne which makes it an easy 1 hour commute to the CBD. The population was recorded as 100,283 in 2014 and is expected to rise by 1.9% per annum by the year 2031.
This regional inland city is at the junction of four major highways namely the Western Highway leading to Melbourne, the Midland highway which links to Geelong, the Glenelg Highway which leads onto Adelaide and the Sunraysia Highway which links to the Calder Highway.
Ballarat still has a number of major manufacturing and processing industries including McCain Foods and Mars Chocolate Australia.
Median house prices in Ballarat Central are around $430,000 with a median rental return of $293 per week. The current rental demand is average in the region.
This can be compared to Ballarat East which has a median house price of $310,000 and a median rent of $280 per week.
Situated around 50 kilometres north of Ballarat is Bendigo, another large regional city. It recorded a population of 106,971 in 2014 and this is expected to grow by 1.8% per annum by 2031. In recent years it has become a centre for major finance and insurance services including Bendigo bank.
Bendigo is also a manufacturing centre for many primary producers around the region. Plus for wine lovers, it is a major area for top wineries along with it’s neighbouring area of Heathcote.
The median house price in Bendigo is $375,000 with a median rental return of $280 per week. The rental demand is average however the annual property price growth is around 3.9%.Market Demand Graph
Melbourne Suburbs To Look Out For In 2018
As well as regional cities, there are a number of Melbourne suburbs to keep an eye on in 2018. These include:
Cheltenham: Median house price is $1.10M with median rent of $520 per week and high demand.
Frankston: Median house price is $601,000 with median rent of $375 per week and average demand.
Werribee: Median house price is $480,000 with median rent of $340 per week and average demand.
Pascoe Vale: Median house price is $900,000 with median rent of $420 per week and high demand.
West Footscray: Median house price is $881,000 with median rent of $430/week and high demand.
Chelsea: Median house price is $905,000 with median rent of $450 per week and high demand.
As you can see, there are plenty of property investment opportunities around both Melbourne suburbs and regional cities around the state. One thing to watch out for at present however, is that the unit/apartment market in and around the Melbourne CBD is currently over run with properties and prices are now a little stagnant and are actually predicted to fall over the next year or so.
Graph 1: https://www.realestate.com.au/…
Image 2: https://www.flickr.com/photos/…