Affordable homes are hard to come by these days particularly in Melbourne and Sydney. This has been confirmed by the latest Mapping the Market Report of CoreLogic that looked into the shift on housing costs in capital cities over the past five years.
The research found that over the years, the median house prices in Melbourne kept rising every quarter for five years. In the September quarter, the median house price went up 1.3 percent. This figure is considered the lowest in a period of three years.
In Melbourne five years ago, 27.5 percent of suburbs in the area had a median house price below $400,000. For units, 51.7 percent had the same price range.
In June 2012, 9.5 percent of Melbourne suburbs had a median value in excess of $1 million. Five years after, that figure went up to 32.6 percent of suburbs. On the other hand, 24.3 percent of Melbourne suburbs had a median house value below $400,000 in June 2012. By June 2017, the figure was down to 2.7 percent.
The latest data up to September 2017, however, showed that only 2.3 percent of suburbs had a median house value below $400,000 and 21.2 percent for units. As of October 2017, the median dwelling values in Melbourne is $710,420.
Median prices for residential properties provide a perspective on what a typical property is either selling for or valued at. In Australia, the median home values across capital cities is $650,930 as of October 2017.
Melbourne’s median house price rose by 0.5 percent in October and 1.9 percent during the quarter. The growth, however, is at its slowest quarterly pace since mid-2016.
On the other hand, the QBE’s Australian Housing Outlook 2017-2020 report noted that the median price in Melbourne will reach $940,000 by the year 2020. The house price growth is expected at 10.2 percent during that period. Median prices for units, however, are tipped to drop by 4.8 percent to $535,000. QBE expects housing affordability in Melbourne will improve by June 2020.
The rise in house prices is attributed to the low housing supply and high population growth caused by an increase in interstate and overseas migration. The minimal growth in household income, however, has made it difficult for many people who don’t own a home yet to save a large amount for their deposit.