Monthly Property Update- September 2017
By Advantage Property | 7th Sep 17
Melbourne continues its strong performance and the market has not slowed down as clearance rates have stayed around 75% and providing some massive capital growth over short periods of time. This was seen at a house in Bangalay Avenue, Frankston South that was purchased by our client for $910,000 only a year ago. An inferior property across the road just sold for $1,550,000, that’s $640,000 or 70% more in only twelve months. Most suburbs are seeing growth of between 20% to 35% in median house prices over the last twelve months.
Melbourne continues to be the preferred shopping destination for overseas buyers and it was again voted the world’s most liveable city for the seventh year running. Singapore and Chinese buyers continue to flock to Melbourne and Chinese buyers spent over $25,000,000 in the last year, up by $5,000,000 so there hasn’t been any slow down from overseas buyers with the increased taxes and stamp duty the Government has implemented to try to slow this market down.
The golden rule in Real Estate is that land appreciates and buildings depreciate and land has never been more King in the Melbourne market as any houses with land value are strongly fought for. There is a collision now between developers and upsizing and downsizing families and this is really pushing the prices of these houses up considerably. We are seeing land sqm rates around $6,000 per sqm in Richmond and a decade ago this was around $2,800 per sqm. In areas like Elwood, we are seeing prices at $5,000 per sqm, up from $2,500 a decade ago. This is consistent with most parts of Melbourne where it is really the land value per sqm that is appreciating.
The market continues to grow at a phenomenal pace and a single fronted house in Beavers Road, Northcote sold for $570,000 for a client back in 2007 and a similar property down the road recently sold for $1,118,000, showing that many areas are seeing a doubling factor in seven years now in Melbourne. There was some strong growth for a duplex in Raleigh Grove in Prahran which sold for $1,650,000 and only sold three years ago for $1,210,000, a $440,000 increase in a short period of time.
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