Melbourne is magic in the middle.
House price data for the year to July was released on Monday and for property tragics like me, it proved a fascinating read.
The overall picture is remarkably rosy, with CoreLogic showing Melbourne house prices rising 10.4% for the year. That was against a backdrop of the best performance in Australian property in 17 years.
Dig a little deeper and an interesting story emerges.
Firstly, let me pat myself on the back. As many of you will recall, throughout last year I was telling anyone who might listen the best place for your money was family homes in middle and outer suburbs.
Now take a look at the top performers and you can see why. Some of the Top 10 are bushy outer suburbs, some are the ‘inner middle’. Some are above Melbourne’s new median price of $1 million, others well below it.
What they share are streets with a suburban feel filled with homes offering generous accommodation - perfect for our new ‘work from home’ lifestyle.
Melbourne Houses – July 2021
|
Suburb |
Median price |
YOY |
5 years |
|
Warrandyte |
$1,352,000 |
25.8% |
38.4% |
|
Pascoe Vale South |
$1,154,000 |
25.4% |
54.9% |
|
Brunswick East |
$1,237,500 |
23.8% |
48.2% |
|
Diamond Creek |
$917,500 |
21.5% |
48.9% |
|
Lysterfield |
$1,115,000 |
18.0% |
34.2% |
|
Ormond |
$1,647,000 |
17.2% |
26.7% |
|
Noble Park North |
$720,000 |
17.1% |
38.2% |
|
Oakleigh |
$1,310,000 |
17.0% |
33.3% |
|
Viewbank |
$1,129,000 |
17.0% |
33.6% |
|
Frankston North |
$520,000 |
16.9% |
56.2% |
Even when you look outside these top performers, Melbourne house prices show this same pattern repeating, with comfortable family housing in long established suburbs proving the best bet.
Much of that theme carries over to the unit market. While the performance numbers aren’t quite as high, growth rates are still impressive.
(East Melbourne is really an enclave, so leave it aside as its performance bounces around on very small sale numbers).
Melbourne Units - July 2021
|
Suburb |
Median unit price |
YOY |
5-year |
|
East Melbourne |
$835,000 |
22.2% |
-25.4% |
|
Thornbury |
$621,250 |
20.6% |
35.8% |
|
Surrey Hills |
$941,000 |
17.6% |
35.4% |
|
Northcote |
$625,000 |
16.0% |
30.8% |
|
Cheltenham |
$665,000 |
14.7% |
35.7% |
|
Langwarrin |
$508,000 |
14.2% |
54.5% |
|
Bonbeach |
$637,500 |
13.5% |
51.8% |
|
Balaclava |
$670,000 |
11.7% |
16.5% |
|
Fairfield |
$568,000 |
11.2% |
20.7% |
|
Collingwood |
$656,000 |
10.7% |
20.3% |
If you’re considering adding to your portfolio or buying your first property, what lessons should you draw from this?
Firstly, don’t chase last year’s winners but take careful note of the theme. Secondly, avoid newly built properties, be they small City apartments or houses on the urban fringe.
And thirdly, get good advice rather than relying on sensational media reports or well-meaning advice from friends. Today’s screaming headlines can quickly become yesterday’s news.
Miriam Sandkuhler.
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