Australian markets continue to see consistent results when compared to the January to March quarter for 2016. January in particular saw a rise of 10 per cent in traded sales year on year in Victoria – far above any other state.
The market growth has been rebounding since the middle of last year when interest rates were cut on two separate occasions and investor demand started to once again trend higher. Prior to this, the growth trend across the housing market had been slowing, reaching a cyclical low point over the twelve months ending July 2016 when the annual change in capital city dwelling values slowed to 6.1%. Since that time the annual growth rate has almost doubled to reach 11.7% over the twelve months ending February this year. This is the fastest annual growth rate since June 2010.
The Melbourne property market performed well over the last year, with strong population growth and a relatively strong economy creating more full time jobs than any other state. Strong 80%+ auction clearance rates show the strength of the local market. This will only be boosted later this year as the newly announced first-home buyers stamp duty savings kicks in. From 1 July 2017, Victoria will no longer charge stamp duty to first-home buyers for any new or established property purchased for up to $600,000.
Locally, we continue to see consistent growth in the median sale prices. Buyers are swooping on properties in Mill Park and South Morang. Ray White South Morang’s Brayden Schmidt said Mill Park was on the map as a good area for investment. “Investors are identifying Mill Park as a blue chip area because of its capital growth, good infrastructure and great rental returns,” Mr Schmidt said. In February, an investor from out-of-the-area outbid three other parties to snap up a four-bedroom house at 9 Blackman Ave, Mill Park, for $650,000, a figure $30,000 beyond the owner’s reserve price. The median house price in Mill Park has jumped 15.8 per cent in the past 12 months to $556,000, according to CoreLogic. It rose 35.6 per cent in the past three years.
The demand for homes in Doreen and Mernda is also rising, with the median house price jumping 13.3 per cent in the past three years to $470,000 in Doreen, according to CoreLogic. Buyers are attracted to the variety of homes in the area, established shops, restaurants and schools coupled with the development of the Mernda Town Centre, the future Mernda Rail Project and the expansion of Westfield Plenty Valley.
The below table shows the median sale price for houses/units and vacant land for the January to March quarter for 2016 versus 2017.
Due to sale prices consistently rising, affordability is becoming a problem for many trying to enter the market. Rental demand continues to significantly increase in all local suburbs due to this.
If you want any further information about the local market, or would like a free, no obligation sale or rental appraisal on your property, please call our office on 03 9404 1222.
Sources: pricefinder.com.au, realestate.com.au