Predictions for the Melbourne market for the rest of 2019

The report also broke down each of Melbourne’s major areas: the north, the south-east and the east.

Due to the current market conditions and the tightening of finance still in place, the report expects eastern Melbourne to be the most successful area and “tread water” throughout the rest of the year if conditions continue, but is liable to change if any external market forces are put into place

Here’s what the report had to say about the Melbourne property market:

North

To the north of the capital city, six months into the year, price declines have been experienced in both the inner north and outer north areas.

Craigieburn, Mickleham and Kalkallo, outer northern suburbs, have continued their decline from their peak in early to mid-2018. Craigieburn, for example, which was previously seen as a good area to invest into, is now seeing the opposite, with a 448 square metre block in land that would have sold for $400,000 is now likely to sell between $340,000 to $350,000.

If purchased off-the-plan in 2016 and sold in 2018, the report stated a profit of up to $100,000 would be possible, but if purchased between late 2017 to early 2018, would be unlikely to sell at cost due to high land supply and low land demand.

Inner northern suburbs, like Carlton, Collingwood, Brunswick and Northcote, have seen median prices decline between $30,000 to $50,000 from the beginning of 2019 and have future declines expected.

Those that aren’t declining, however, are properties targeted towards families of high quality and placed in optimal locations.

Pascoe Vale, however, has seen a change in gears that has previously been driven by developers but now is seeing a lack of developer-backed properties.

“Pascoe Vale has been development-shy this year, and if lenders do not reduce their strict criteria, townhouse developments in Pascoe Vale may be very limited going forward,” the report noted.

South-east

The south-eastern property market is seeing a similar story, with the bottom of the market still a ways away.

Supply can still be found in the inner suburbs, like Bentleigh East and Hampton, through a large number of townhouse developments, even though this area has seen large declines in prices.

Vacant land in this area has also suffered in the last year, being faced with oversupplies and potential buyers having issues securing finance, while the outer south-eastern area has remained mostly unchanged by market pressures, the report noted, as units here are typically more affordable.

East

Eastern Melbourne has seen success in comparison to the other areas, with rising demand and auction clearance rates and is being propped up with record-low interest rates.

According to the report through real estate agent John Costanzo, Ringwood and Croydon contain “plenty of value”, along with Wantirna.

The latter suburb is expected to benefit from Wantirna South’s median price rise to over $1 million and contains solid transport options and is close to Westfield Knox Shopping Centre, which is expected be redeveloped, starting from November 2019.

“Investors should start thinking about suburbs where infrastructure upgrades, particularly with links to transport, could put them at the top of the next boom,” the report stated.