Croydon: Maroondah suburb ranked one of Melbourne’s top 50 to invest in

A Maroondah suburb has been ranked one of Melbourne’s most popular with investors looking for more bang for their buck. Find out why.

A Maroondah suburb is experiencing a property boom — despite the uncertainty brought on by Covid — as investors look to enjoy its green spaces and family friendly amenities.

Croydon has been ranked 17th in realestate.com.au’s list of Melbourne’s Top 50 suburbs to invest in, based on three key metrics of long-term capital growth, rental yields and tenant demand.

It was the only suburb in the outer east to reach the top 20 apart from Ferntree Gully, in neighbouring Knox, which placed 19th.

Croydon ranked highly on the list due to its consistent house sale figures despite the impact of the pandemic.

The suburb recorded 289 house sales in the first half of 2021, four higher than its total of 285 sales at the end of June 2011.

House prices in the suburb have also soared by 77.4 per cent in the past 10 years.

Fletchers Real Estate director Reilly Waterfield said he felt Croydon was still “very undervalued” due to its amenities and connections to nearby private schools.

Mr Waterfield said clients from Blackburn, Box Hill, Doncaster and Bulleen had been drawn to the area to get more “bang for your buck”.
“On the back of last year’s lockdowns, I think we have flow-on effect and pent-up demand to move into the outer eastern suburbs,” he said.

“It (Croydon) is a good pivot point to the premier schools in the area … you’ve got Yarra Valley Grammar, Luther College, and Oxley College all in easy reach.

“It’s still a very affordable space, you’ve got EastLink and Eastland down the road, and you’re not paying a huge amount to get in.”

Along with its existing amenities, Croydon is set to get a rail infrastructure overhaul to benefit commuters in the next four years.

A 500-space multi-deck commuter carpark is set be finished by the end of the year, while a new train station will be built and the Coolstore Rd level crossing removed by 2025.

Realestate.com.au’s data also found the price of units in three Maroondah suburbs had experienced some of the biggest price rises throughout Melbourne in the past 10 years.

Bayswater North (3rd), Heathmont (4th) and Croydon North (7th) all made the top 10, which was topped by Ashwood in Melbourne’s east with a staggering 96.5 per cent growth on 2011 prices.

Prices soared by more than 80 per cent in Bayswater North (80.6 per cent) and Heathmont (80.2 per cent), with Croydon North not far behind on a 76.5 per cent increase.

REA economist Paul Ryan said “the Covid effect” that had led to suburbs further from the CBD dominating the top 50 list was largely the result of a significant shift in where renters wanted to live.

“Expats coming back to Melbourne, or people who are living in small apartments in the city and working from home are thinking, ‘if we’re not working from the office, can we choose somewhere with more lifestyle amenity’,” he said.

“That’s pushing a lot of those Mornington Peninsula suburbs and quite pleasant outer-suburban regions on to the list.”

Data Explained:

The list was created by realestate.com.au to feature suburbs in the top half of distribution for three metrics:

1. 10-year median price growth: percentage change in median price in year to June 2021, compared with year to June 2011.

2. Rental yield: how much profit you generate from your investment as a percentage, calculated by determining the annual median rent as a proportion of the median price.

3. Annual change in rental demand: based on searches on realestate.com.au by “high-intent renters” who have looked at multiple properties, made inquiries with agents or booked inspections.