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THE market leading pace with which some western suburbs started the year, seems to have hit a snag, with the top ten suburbs recording relatively lower levels of growth than the other regions. Only nine of 22 eligible western suburbs recorded median house price increases over the metropolitan average of 4.2 per cent.
The recipe for success this year however, appears simple - live on the bay, or near a train line - and you’re safe as houses!
Areas surrounding Port Phillip Bay featured most prominently in the analysis of annual median sale price growth in Melbourne’s ever sprouting western suburbs. Live in a ten kilometre ring of the CBD and you’ve done well. If you chose to build a new house in an estate of Melton or Hillside, you can pat yourself on the back too.
Keilor, which was not included in the REIV rankings as it had less than 30 sales for this quarter, also performed strongly and now has a median house price of over $500,000.
“The west of Melbourne has a good combination of affordable properties, diversity of stock available, all which has shown steady capital growth.” said Enzo Raimondo, chief executive of the Real Estate Institute of Victoria, which compiles these figures.
Kensington was the only inner-city suburb represented in the western suburbs, reporting an annual median house increase of 5.7 per cent and a median house value of $436,000. Agents say that inquiry is getting stronger for Kensington Banks - a ‘gated community’ which more than doubled the inner western suburb’s size ten years ago - but that the big money still chases the established Kensington ‘village‘.
“Kensington Banks is the entry level for buyers looking at getting into the inner city market, with one bedroom townhouses selling in the range of $270,000 - $320,000.” said Tony Downward, director of Biggin & Scott in Kensington. “The age of the average buyer is much younger than it was ten years ago and is dominated by singles and couples.”
A shortage of double fronted houses is seeing new records set for larger properties in the developing suburb. “The problem is that of the 3000 houses in Kensington, only about 300 are double fronted - so locals contest hotly when a larger property comes up.”
The growing family is one reason Mr Downward cites Ascot Vale as performing strongest of all western suburb this year, recording a median house value increase of 15.7 per cent this year. “People who can’t get the property they want in Kensington but want to stay in the inner north-west, are pushed out to Ascot Vale where larger period properties are more common.”
Kensington, Ascot Vale and Essendon - which all make the top ten list, coincidentally follow each other on the train line.
“I have a theory that if you’re successful and live in the western suburbs and want to stay there, there are few places to upgrade to,” says Angie Zigomanis, senior consultant with researcher and forecaster BIS Shrapnel. The sustained period of economic growth means there are more and more higher income earners in the west too, he adds.
Williamstown, home to Premier Steve Bracks, is fast becoming ‘the place to be’ in the west, with median house value increasing 8.9 per cent to $675,000 for the year. “You could argue that Newport and Altona are also benefiting from those who can’t afford Williamstown.” says Mr Zigomanis.
Melton - considered the entry level for many home buyers, was the sixth best performing suburb, with median value increasing 8.3 per cent to $195,000 for the year. With buyers in the outer western suburb more sensitive to interest rate rises however, agents do not anticipate a significant increase on this median value, moving forward.
“Over the last decade the west has been the beneficiary of significant improvements in infrastructure such as the Western Ring Road and amenities such as improved schools and shopping which has made its benefits more accessible and attractive to the rest of Melbourne.” said Mr Raimondo.
“There are also further development plans which will add value to the area such as proposed lifestyle developments to add to the already popular Sanctuary Lakes at Point Cook development.” he said. “All of these factors have been reflected in the increasing property values over the last couple of years and further room for growth.”
Agents expect the bayside areas to continue to tow the overall western market. The suburb of Altona in particular, which has experienced relatively astronomical growth since the last real estate boom, appears again in the rankings, with an annual median price increase of 14.8 per cent.
Keilor - which agents reiterate is about the same distance to the north-west of the CBD as Brighton is on the south east - is also tagged for a bright future as locals abandon the more congested middle western suburbs and sprinkle themselves around the elevated Brimbank Park and the Maribyrnong River precinct.
“Many new Keilor residents relocate from the more expensive suburbs of Strathmore, Essendon and Moonee Ponds,” said Boran Rusinovic, licensed estate agent with Ray White Taylors Lakes.
This is translating to high sale prices. “Earlier this year a property in Keilor sold for $2.25 million, and I have another on the market expected to fetch around $1.5 million.” said Mr Rusinovic.
Closer to town, Ascot Vale, North Melbourne and Maribyrnong are pick of the bunch.
“Maribyrnong is one of the few places that offer brand new dwellings for people to move into that isn’t on the suburban fringes.” said Mr Zigomanis.
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