- The Melbourne housing market has declined this year
- Much of the loss, however, has been from the upper end of the market
- Some markets appear to be performing strongly, and will continue to do so into next year
Melbourne, like most real estate markets in Australia, has declined over this year.
The top-end market, in particular, has dropped, pulling down the city’s median price.
This gives the impression of a widespread decline, noted property expert Terry Ryder, despite many key market sectors performing relatively well.
“Melbourne is a resilient city and, according to CommSec’s State of the States report published in July 2022, the Victorian economy ranks first in the nation,” he said.
“Analysis of sales volumes indicates that some sections of the Melbourne market have maintained solid buyer activity in 2022 and instances of price decline are not widespread.”
Terry Ryder
Canstar’s Rising Stars Report noted that middle markets such as the local government areas of Monash and Whitehorse have held up well, as have the more affordable outer-ring precincts of Hume, Whittlesea, Melton, Wyndham and Casey, with all recording good levels of sales activity and steady prices.
Notably, there is a strong quest by buyers for affordable apartments in inner-city suburbs. This is an emerging national trend, especially in the biggest cities, and is driven by both lifestyle and affordability.
However, the Melbourne market is, overall, subdued.
Top 10 Best Suburbs to invest in Melbourne in 2023
- Caroline Springs
- Epping
- Forest Hill
- Glen Waverley
- Hoppers Crossing
- Melton South
- North Melbourne (Units)
- Richmond (Units)
- Roxburgh Park
- Sunbury
Analysis by Mr Ryder and Canstar shows that the affordable outer-ring precincts have solid demand from buyers, as do middle-market areas and inner-city unit markets.
Pursuing affordable areas with good amenities is also a popular theme.
Caroline Springs
Located on the western fringe of Melbourne, the City of Melton is a key population precinct. It’s also a relatively affordable sector, attracting first-home buyers. Sales activity, therefore, remains strong in the master-planned suburb of Caroline Springs. Although pricing is higher than most Melton locations, it’s affordable compared to the Melbourne median house price of $950,000. Amenities include schools, shops, green space and a train station.
Epping
Located in Melbourne’s north, Epping is popular thanks to its fundamental infrastructure, amenities and employment options. Epping has a railway station, shopping centre, bulky goods retail, multiple schools and an expanding hospital. The Melbourne Wholesale Markets and various logistics businesses also line the nearby motorways. Given Epping’s relative affordability, sales activity is strong and the vacancy rate is below 1.5%, according to SQM Research.
Epping
[Select part of the chart to zoom in on various years, and ‘reset zoom’ button to return]
Forrest Hill
Quintessential middle Melbourne, the City of Whitehorse has had a consistent record of strong demand and steady growth. Forest Hill itself has averaged price growth of 8.7% per year in the past decade. Now, houses are typically above $1 million. The suburb is well connected due to its arterial road network and tramways, with many green spaces and good schooling and retail options.
Glen Waverley
Located in Monash City, which is known as a centre of commerce, education and high-quality residential suburbs. Landmarks in the area include Monash University, Victoria Police Training Academy, the Woolworths Distribution Centre and several major corporate parks. The Monash LGA is bisected by the Monash Freeway itself, and Gln Waverley has a major train station. Over the past decade, price growth has averaged 8.8% per year. The median house price in the suburb is now $1.6 million. In the past year, around 550 houses have been sold and nearly 300 apartments.
Hoppers Crossing
Suburbs across the Wyndham City Council are attracting steady buyer demand thanks to their relative affordability, infrastructure and proximity to major employment nodes. Hoppers Crossing is a major centre for these features, thanks to its university campuses, a hospital, major shopping centres, schools and colleges, train station and the East Werribee Employment Precinct. Houses in the area average around the high $500,000 and low $600,000 mark.
Melton South
The City of Melton continues to be popular with buyers, with Melton South itself witnessing a doubling in sales activity. Buyers are chasing the area for affordability; it is one of the few remaining Melbourne locations where houses are under $500,000 despite price growth averaging 8.1% per year over the past decade. Melton South is known as being an educational node, with multiple schools and colleges, along with various green spaces.
North Melbourne (Units)
A major emerging trend in the Melbourne property market is the popularity of inner-city suburbs with affordable apartments. North Melbourne –sandwiched between the Melbourne CBD and the hospital and universities precinct of Parkville/Carlton – make this suburb’s unit market highly popular. The median price for apartments is $535,000, a fraction of the median house price which is $1,315,000.
Richmond (Units)
Similar to North Melbourne, the unit market in Richmond is popular, with a median price of $660,000 compared to the median house price in the suburb which is $1,500,000. Given its proximity to the Melbourne CBD, Richmond offers plenty of lifestyle elements and has good credentials as the apartment trend continues.
Roxburgh Park
With much of Melbourne’s urban sprawl happening in the north, jobs are clustering there, especially in the logistics and industrial sectors. Roxburgh Park is one suburb benefitting from these trends. By Melbourne’s standards, houses there are affordable and the infrastructure is solid, with good schools, parks, sporting facilities, golf courses, train station and shopping centres.
Sunbury
The outer north-western suburb of Sunbury is home to 40,000, comparable to a major regional city. It has the facilities of a small city, with the town centre accommodating a major shopping centre and a train station on the Melbourne-Bendigo line. Sunbury is home to numerous parks, nature reserves, schools, colleges and a golf course.
Top 10 Best Suburbs to invest in Melbourne in 2023
| Suburb | Median price | 1-yr growth | 10-yr average annual growth (%pa) | Vacancy rate | Median rental yield | Upfront costs* | 20% deposit amount | Monthly repayments (P&I) with 80% LVR |
| Caroline Springs | $735,000 | 11.3% | 5.7% | 1.3% | 3.1% | $41,097 | $147,000 | $3,247 |
| Epping | $700,000 | 15.7% | 6.8% | 0.8% | 3.0% | $38,915 | $140,000 | $3,092 |
| Forest Hill | $1,205,000 | 16.0% | 8.7% | 1.2% | 2.1% | $69,302 | $241,000 | $5,323 |
| Glen Waverley | $1,635,000 | 18.5% | 8.8% | 1.4% | 1.7% | $93,642 | $327,000 | $7,223 |
| Hoppers Crossing | $610,000 | 8.6% | 6.8% | 1.7% | 3.0% | $33,304 | $122,000 | $2,695 |
| Melton South | $495,000 | 13.2% | 8.1% | 1.4% | 3.5% | $23,035 | $99,000 | $2,187 |
| North Melbourne (U) | $535,000 | 0.0% | 3.1% | 1.7% | 3.7% | $25,529 | $107,000 | $2,363 |
| Richmond (U) | $660,000 | 2.0% | 2.2% | 1.6% | 3.4% | $36,421 | $132,000 | $2,916 |
| Roxburgh Park | $630,000 | 6.3% | 6.0% | 1.2% | 3.5% | $34,551 | $126,000 | $2,783 |
| Sunbury | $650,000 | 8.3% | 6.5% | 0.9% | 3.2% | $35,798 | $130,000 | $2,871 |
Source – Canstar and SQM Research
~~
For other top suburb-style articles in Melbourne, check out our Top 20 Suburbs for Families in Melbourne article.
For other top investment suburbs articles, check out this one for Sydney, Brisbane and Perth.
