Property Investment In Melbourne — Suburbs Analysis & Expert Advice

So…is it too late to get into the Melbourne property market?

Like most things in real estate, the answer is — it depends.

  • The Victorian economy continues to strengthen creating more (higher paying) jobs
  • Record international and interstate migration will continue.
  • 1,500 new households are being formed in Melbourne each week and the supply of new housing is struggling to keep up with this burgeoning demand.
  • Melbourne’s rental market is tightening, with low vacancy rates and rising rentals.
  • First home buyers are back in the market
  • There continues to be strong foreign interest in Melbourne from tourists, migrants, investors and developers

1. Melbourne Property Market Prices

Over the past couple of years, Melbourne home values have risen at the second-fastest pace of all capital cities.

2. Long Term Melbourne Property Market Trends

Historically, the city’s property market has gone from strength to strength.

3. Melbourne’s Average Rental Yield

While over the long term rentals have grown in line with property values, more recently rental growth has remained moderate.

What’s so special about Melbourne?

4. Melbourne’s demographics

As Australia’s second-largest city, Melbourne is home to around 4.82 million people which accounts for 19.05% of the national population.

5. Melbourne’s Layout

As with most large cities, greater Melbourne is divided into ‘east’ and ‘west’ neighborhoods; those in the east are more established and generally considered more affluent, while those in the west are more affordable, newer suburbs with less established reputations.

6. Melbourne’s Infrastructure

Melbourne residents enjoy the use of some of Australia’s most advanced and well-connected systems of road, rail and tram infrastructure, which give locals plentiful options when deciding how to get around the city and its surrounding suburbs.

7. Melbourne’s Economy

As a cosmopolitan, creative city that is served by a number of industries, Melbourne residents enjoy employment in diverse industries, from tourism, hospitality, and entertainment to commerce, industry, and trade.

8. Melbourne’s growth

Melbourne’s population now stands at over 5 million people and Melbourne is still the fastest-growing cities in the country, growing at around 2.4% per annum.

9. Melbourne’s culture

The city of Melbourne is nothing if not multicultural, with dozens of different cultures and nationalities — 140 to be exact — living side-by-side.

What types of properties perform well in Melbourne?

10. Melbourne Houses

Decades ago, the Australian property market was dominated by demand for freestanding houses.

11. Melbourne Town Houses

The term townhouse originally referred in British usage to the city residence of a member of the nobility, as opposed to their country estate.

12. Melbourne Units

13. Melbourne Flats / Apartments

If you invest in a flat you are generally buying an apartment that has other dwellings attached to it; these could be above or below, next door, or a combination of the above.

14. Commercial, Retail and Industrial properties

How do Melbourne’s areas compare?

15. Inner City

Melbourne’s inner city core has a population of around 29,450 people, a figure that is expected to double to 59,900 over the next 20 years.

16. Bayside and South-Eastern Suburbs

Melbourne’s south-eastern suburbs boast distinct communities, neighbourhood attributes, and differing property growth cycles.

17. Eastern Suburbs

18. Western & Northern Suburbs

While the outskirts of Melbourne’s west and north is home to several of the city’s fastest-growing outer-suburban areas including Truganina, which increased by 18%, Tarneit (16%), Point Cook (12%), Melton South (11%) and Wyndham Vale (10%).

19. Melbourne has high standards

20. Avoid Melbourne’s poor-quality apartments

Just because Melbourne has a well-deserved reputation for quality, that doesn’t mean the city is flawless — far from it.

21. Look for Melbourne’s best properties in the inner and middle-ring suburbs.

22. Be mindful of a Melbourne inner-city apartment oversupply

Melbourne’s property market has been typified by strong population growth and to keep up with surging housing demand, there have been a huge number of new developments — mostly in the form of high-rise apartment buildings, in and around the CBD — that have been approved.

23. Make the most of Melbourne properties through negative gearing

How do you choose an investment property in Melbourne?

We believe that 80% of your property’s performance is related to its location (one that outperforms the averages ) and 20% or so is related to buying the right property in that location.

24. Buy a property for below its intrinsic value

I’m a big believer in buying property for below its intrinsic value — that’s why I avoid new and off the plan properties, which generally attract a premium price tag.

25. Buy a property in a location that outperforms the averages

26. Buy a property with a twist

An investment must have something unique, or special, or different or scarce — some ‘X factor’ that makes it stand out from its neighbours — in order to land on my shortlist.

27. Buy a property where you can manufacture capital growth

An ideal investment is one in which you can manufacture capital growth through refurbishment, renovations or redevelopment.

How can I stay on top of current information?

28. Get property news, updates and advice by email

There is so much information available about various property investing trends, strategies and market information that it can be overwhelming knowing where (or how) to get started.

29. Take advantage of investment advice

Whether you are new to property investing, or a seasoned landlord with many years of experience in the trenches, the team at Metropole would love to help you formulate an investment strategy or review of your existing portfolio, with a shared goal of helping you acquire your next A-grade investment property.

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
Michael Yardney

Michael Yardney

2.3K Followers

Michael Yardney is a #1 bestselling author & a leading expert in the psychology of success and wealth creation Sharing stories on Success, Property & Money