The REIV median prices for the December quarter show that Melbourne’s median has experienced a drop of 0.9 per cent over the quarter and 9.7 per cent decline over 12 months. This can be directly attributed to continuing economic uncertainty and a decline in investor and consumer confidence.
The suburbs that have shown the greatest decline in median values in the quarter are in the more expensive end of the market and are the same suburbs that enjoyed unsustainable growth throughout 2007. Brighton, for example, shows a quarterly drop of 4.7 per cent, and is down 21.1 per cent for the year. Toorak, despite its ranking as Melbourne’s most expensive suburb, dropped 8.5 per cent in the same 12 month period.
Of the top 20 growth suburbs for the quarter only six show a median price in excess of the December median, $426,000.
This is a result of the increased demand for affordably priced properties − and this demand is driven by three factors: Melbourne’s strong population growth; an undersupply of newly constructed properties; and a reduction in interest a rates proving to be an incentive to first home buyers to enter the market.
Four suburbs recorded double-digit growth in the December quarter, compared to five in the September quarter. Suburbs in the top 10 for growth were Templestowe, Eltham, Deer Park, Craigieburn, Ferntree Gully, Broadmeadows, Malvern East, Sunbury, Hawthorn and Mill Park.
As the most expensive suburb, Toorak posted a median of $2,538,750, while the most affordable suburb was Melton, with a median of $225,000.
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Tags: cent, decline, double digit growth, drop, economic uncertainty, First home buyers, malvern east, reiv, show, unsustainable growth
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