Family homes driving growth in Melbourne's middle ring

Date: 1 Aug 17

Large homes in Melbourne’s bridesmaid suburbs were standout performers in the June quarter, with demand bed-mediansFINAL.jpgfor space driving buyers further from the city.

The latest REIV data shows four-bedroom homes in Melbourne’s middle ring outpaced all other property types and regions in June, increasing 6.5 per cent to a median of $1,150,000.

Reservoir and Mill Park in the city’s north experienced some of the strongest quarterly price growth for this property type, up 8.2 and 7.7 per cent respectively.

Meanwhile, four-bedroom homes in the outer suburb of Keysborough experienced the largest price growth citywide, up 17.1 per cent to a median of $900,000 – an increase of more than $130,000 on March figures.

REIV President Joseph Walton said growth for large homes within 20km of the CBD is being driven by demand from both owner-occupiers and developers.

“Larger homes remain attractive to a broad range of buyers, particularly in the city’s middle ring where densification and height restrictions have been lifted,” he said.

“Vendors in these areas are also benefiting from buyers being priced out of inner city suburbs, with the median for a four-bedroom house within 10km of the CBD currently sitting at just under $2 million.

“Family homes in Melbourne’s inner ring are out of reach for many buyers, with growth in these suburbs being seen for smaller, two-bedroom houses rather than the typical three or four-bedroom property.”

Mr Walton added that demand for homes and strong population growth continues to lift prices across the city.  
“Strong competition for larger properties is certainly encouraging more vendors to consider downsizing and putting the family home on the market,” he said.

Citywide, three-bedroom homes recorded the largest price growth, up 4.8 per cent to a median of $697,250. 

Highett in Melbourne’s south-east recorded the highest increase for this property type with the median price up 13.3 per cent over the quarter to $1,190,000.