{"id":3034,"date":"2022-07-10T08:16:13","date_gmt":"2022-07-10T08:16:13","guid":{"rendered":"https:\/\/royabhishek.in\/urbanbuyer\/16-melbourne-suburbs-that-are-cheaper-now-than-5-years-ago\/"},"modified":"2022-07-10T08:16:13","modified_gmt":"2022-07-10T08:16:13","slug":"16-melbourne-suburbs-that-are-cheaper-now-than-5-years-ago","status":"publish","type":"post","link":"https:\/\/royabhishek.in\/urbanbuyer\/16-melbourne-suburbs-that-are-cheaper-now-than-5-years-ago\/","title":{"rendered":"16 Melbourne suburbs that are cheaper now than 5 years ago"},"content":{"rendered":"

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Prices in Melbourne\u2019s property market<\/a> went backwards in May after the Reserve Bank of Australia raised the cash rate for the first time since November 2010.<\/p>\n

But median property prices are still high versus household income across most of the city\u2019s suburbs.<\/p>\n

And that’s thanks to historically low-interest rates, government incentives, pandemic-induced interstate migration and historic levels of demand from buyers over the past two years.<\/p>\n

Data shows that Australia\u2019s overall property prices beat records in the final quarter of 2021, with the national median house price surpassing $1 million for the first time.<\/p>\n

That\u2019s a 25.7% year-on-year surge in house prices and a 7.7% year-on-year increase for units.<\/p>\n

And for Melbourne<\/a>, price growth was just as strong.<\/p>\n

\"Melbourne<\/p>\n

Domain data<\/a> shows that Melbourne\u2019s median property price currently sits at $1,092,144 versus $981,401 just 12 months ago.<\/p>\n

And over the past five years, the price difference is even more pronounced.<\/p>\n

And there are some Melbourne suburbs where price growth<\/a> was particularly exceptional.<\/p>\n

For example, Anglesea on Victoria\u2019s Great Ocean Road has a current $1.6 million median property price, according to recent PropTrack data, representing a 145.21% growth from its 2017 median of $652,500.<\/p>\n

This is not surprising given the latest sea- and tree-change trend for homeowners to leave their city lifestyle in favour of a lifestyle suburb.<\/p>\n

Enjoying the same trend is St Andrews Beach on Melbourne\u2019s Mornington Peninsula which has seen a 128.67% increase in its median property price over the past 5 years to a new $1.8 million median.<\/p>\n

Not every suburb follows the same trend<\/span><\/h2>\n

Sure, these statistics are impressive, but not every Melbourne suburb has followed the same fate.<\/p>\n

In fact, there are several suburbs where prices have plunged over the same period, even despite the property boom.<\/p>\n

Data analysis by Domain<\/a> found that there are a handful of suburbs in Victoria where prices are actually cheaper now than what they were in 2017 \u2013 significantly, in some cases.<\/p>\n

Interestingly, like in New South Wales and Queensland, all of the 16 suburbs are in Melbourne, and all are units.<\/p>\n

For example, a unit in East Melbourne would set you back around $767,250 today, which is an enormous 44.4% less than just 5 years ago.<\/p>\n

The nearby suburbs of Carlton, Melbourne and Box Hill have all also seen dramatic median price declines since 2017, with median unit prices in the area coming in around 20.3%, 18.2% and 14.6% lower today respectively.<\/p>\n

In fact, the data shows that it is the inner urban region of Melbourne which is most affected, accounting for 12 out of the 16 suburbs on the list.<\/p>\n

\u00a0<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
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VIC suburbs where property prices are cheaper now than they were 5 years ago<\/strong><\/p>\n

<\/td>\n<\/tr>\n
State<\/td>\nSuburb<\/td>\nRegion<\/td>\nProperty<\/td>\nMedian<\/td>\n5-year Change<\/td>\n<\/tr>\n
VIC<\/td>\nEast Melbourne<\/td>\nInner Urban<\/td>\nUnit<\/td>\n$767,250<\/td>\n-44.4%<\/td>\n<\/tr>\n
VIC<\/td>\nCarlton<\/td>\nInner Urban<\/td>\nUnit<\/td>\n$395,000<\/td>\n-20.3%<\/td>\n<\/tr>\n
VIC<\/td>\nMelbourne<\/td>\nInner Urban<\/td>\nUnit<\/td>\n$465,000<\/td>\n-18.2%<\/td>\n<\/tr>\n
VIC<\/td>\nBox Hill<\/td>\nInner East<\/td>\nUnit<\/td>\n$495,000<\/td>\n-14.6%<\/td>\n<\/tr>\n
VIC<\/td>\nParkville<\/td>\nInner Urban<\/td>\nUnit<\/td>\n$480,000<\/td>\n-11.3%<\/td>\n<\/tr>\n
VIC<\/td>\nEssendon North<\/td>\nWest<\/td>\nUnit<\/td>\n$425,000<\/td>\n-9.5%<\/td>\n<\/tr>\n
VIC<\/td>\nToorak<\/td>\nInner Urban<\/td>\nUnit<\/td>\n$959,500<\/td>\n-7.3%<\/td>\n<\/tr>\n
VIC<\/td>\nNorth Melbourne<\/td>\nInner Urban<\/td>\nUnit<\/td>\n$512,500<\/td>\n-6.8%<\/td>\n<\/tr>\n
VIC<\/td>\nSouthbank<\/td>\nInner Urban<\/td>\nUnit<\/td>\n$562,500<\/td>\n-6.1%<\/td>\n<\/tr>\n
VIC<\/td>\nArmadale<\/td>\nInner Urban<\/td>\nUnit<\/td>\n$670,500<\/td>\n-5.2%<\/td>\n<\/tr>\n
VIC<\/td>\nDocklands<\/td>\nInner Urban<\/td>\nUnit<\/td>\n$600,000<\/td>\n-2.8%<\/td>\n<\/tr>\n
VIC<\/td>\nDoncaster<\/td>\nInner East<\/td>\nUnit<\/td>\n$530,000<\/td>\n-2.8%<\/td>\n<\/tr>\n
VIC<\/td>\nMelbourne<\/td>\nInner Urban<\/td>\nUnit<\/td>\n$650,000<\/td>\n-2.1%<\/td>\n<\/tr>\n
VIC<\/td>\nAbbotsford<\/td>\nInner Urban<\/td>\nUnit<\/td>\n$558,000<\/td>\n-2.1%<\/td>\n<\/tr>\n
VIC<\/td>\nCaulfield South<\/td>\nInner South<\/td>\nUnit<\/td>\n$642,750<\/td>\n-1.9%<\/td>\n<\/tr>\n
VIC<\/td>\nSouth Yarra<\/td>\nInner Urban<\/td>\nUnit<\/td>\n$620,000<\/td>\n-1.6%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

\u00a0<\/p>\n

Domain points out<\/a> that Melbourne\u2019s inner-city unit market is peppered with suburbs that are more affordable now than they were in 2017, thanks to an oversupply that the market is still recovering from.<\/p>\n

Some suburbs, like Doncaster, Toorak, Southbank and Armadale, have suffered the bulk of their price falls over the past couple of years as the COVID property trend that favoured houses, particularly in the outer suburbs and regions, left inner-city units lagging behind.<\/p>\n

But other suburbs that recorded negative results for units over a five-year period, such as Carlton, Melbourne City and South Yarra, are back on the rise.<\/p>\n

Cheapest isn\u2019t always best<\/span><\/h2>\n

While it might be tempting to be attracted to the low price growth in some of these suburbs, it\u2019s important to remember that low median house prices alone aren\u2019t enough alone to warrant a good investment opportunity.<\/p>\n

\u2018Cheap\u2019 property will always be \u2018cheap\u2019 so don\u2019t get lured into thinking you\u2019re getting a bargain.<\/p>\n

Also, don\u2019t expect investment-grade<\/a> returns from secondary locations and properties.<\/p>\n

Of course, we all know by now that location will do about 80% of the heavy lifting of a property\u2019s capital growth.<\/p>\n

And that\u2019s why it\u2019s important to buy your investment property<\/a> in a suburb that is dominated by more homeowners, rather than a suburb where tenants predominate.<\/p>\n

\"Melbourne2\"<\/p>\n

Nicola Powell, chief of research and economics at Domain<\/a>, agrees that while the opportunity to buy for less than 2017 prices is very real, buyers need to do their homework before leaping in.<\/p>\n

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\u201cIf you\u2019re looking to purchase a unit \u2013 and many are because we\u2019ve seen houses over-perform \u2013 it always goes back to what is the quality and point of difference in the place you\u2019re purchasing? <\/em><\/p>\n

And how broad is that buyer pool going to be when you go to sell it down the track?\u201d <\/em>she said.<\/p>\n

\u201cIt\u2019s important to buy a property that\u2019s going to enable you to buy in the future and upgrade.\u00a0<\/em><\/p>\n

\u201cIf you\u2019re looking to purchase a unit in these areas where prices are still below that of 2017 levels, make sure you understand the developer you\u2019re buying from, and what\u2019s the point of difference between your place and others.\u201d<\/em><\/p>\n<\/blockquote>\n

Our advice at Metropole<\/a> is even firmer than that \u2013 don\u2019t fight the big trends<\/strong> \u2013 if these apartments could not perform during a boom, why would you expect them to perform well in the long term?<\/p>\n

Just avoid them!<\/p>\n

ALSO READ:<\/strong><\/p>\n

17 Sydney suburbs that are cheaper now than 5 years ago<\/a><\/p>\n

16 Brisbane suburbs that are cheaper now than 5 years ago<\/a><\/p>\n