STRONG MARKETS IN REGIONAL VICTORIA
According to a recent REIV (Real Estate Institute of Victoria) research bulletin, the property market is strong and stable in regional Victoria. An auction clearance rate of 71.1% was recorded in July post-financial year, well above the state average of that time. Median house prices have also continued to outperform metropolitan Melbourne and rental vacancy rates are low (meaning very few investment properties are vacant).
Although some people are nervous after the Big 4’s decision (following Westpac) to raise interest rates, however slight, the Reserve Bank has assured Australians that they do not intend to change their cash rate, which remains at 1.5% (as at 12th September 2018). We have seen media fearmongers at work in recent days, trying to convince the general public that there are grey clouds on the horizon, but the numbers do not lie. Despite the bad reports and rumours about “corrections”, “bubbles”, and “drops”, our market continues to sail smoothly.
Investors are favouring the Kinglake Ranges as a region of high rental yield. The area is a great place to invest for rent, showing higher returns than in metropolitan Melbourne, especially when you compare purchase prices and mortgage repayments.
Kinglake’s median rent at the time of this report is $380 per week (according to the REIV), well above the median for regional Victoria at $330. Its median sale price - $550,000 – is also over $100,000 in excess of the median for regional Victoria. Kinglake West raises the bar even higher, with a median at $638,000. For ease of understanding, we have produced a map detailing the median sale prices for the Kinglake Ranges and surrounds:
Here you can see that the median sale price for metropolitan Melbourne is $840,000 while in regional Victoria it is $420,000 (the boundary is marked in red). The only suburb to register any depreciation in values has been Healesville, but even its correction is a minor 0.2% which equates more to a settling of values that any serious drop.
I recall speaking to someone recently regarding a property in Flowerdale, which itself sits above the regional average. In response to these numbers they said, ‘So much for property prices falling.’ This may give voice to a number of buyers who developed some excitement at the prospect of property prices falling, but unfortunately it isn’t going to happen. As previously reported, values have settled rather than gone backwards.
Looking at the big picture, this is good news for both buyers and vendors alike. For buyers, steady and realistic price expectations mean a fair and balanced market. Combined with a relaxed average selling time of 44 days on market (according to REIV), buyers are well and truly equipped to make well-informed, well-timed decisions in the market place. For vendors, the appeal of realistic pricing means increased numbers of buyers come the Spring. It is a win for everyone. Instead of an imbalance of too little stock or too few buyers, this Spring-Summer season is set to be a big one. Buyers are already lining up at Integrity Real Estate, taking numbers, and waiting for our mid-Spring listings. With over 15 bona fide listings due to launch in the month of October, buyers know where to shop for the best properties.
If you are considering selling, Spring is most definitely the time. We have high numbers of qualified buyers, stable market conditions, and fantastic weather. What more do you need? If you have any questions or would like discuss your needs, contact our team on 5786 2033.