Heroin scourge blamed for plunging property prices
North Richmond’s median house price has plunged more than those in the rest of Richmond in recent months and real estate agents and homeowners are blaming the suburb’s injecting room for the hit.
VIC News
Don't miss out on the headlines from VIC News. Followed categories will be added to My News.
North Richmond property prices have slumped since the controversial injecting room opened.
The median house price in the block around the injecting room, bordered by Hoddle, Church, Victoria and Highett streets, dropped from $1.19 million to $991,000 in the year to June 2019.
The median unit price dropped from $530,000 to $447,500.
The fall came during a property downturn across Melbourne, but Real Estate Institute of Victoria data shows a sharper drop in the streets surrounding the injecting room compared to the broader suburb of Richmond.
North Richmond’s median house price fell 16.5 per cent and the median unit price fell 15.6 per cent. Richmond’s median house price fell by 5.4 per cent and its median unit price rose 4.2 per cent.
A two-bedroom house on Lennox St, opposite the injecting room, sold for $687,500 in May last year but Biggin & Scott director Edward Hobbs estimated it would have fetched $100,000 more “without the injecting room issue”.
“You don’t get many homes that sold for that price in 2019,” he said.
“We try to advise owners at the moment that they are pretty tricky to sell so, if they can, hold on to it until we get some clarity around the injecting room trial.
“If you need to sell it now you are taking a hit, and on a good house that could be 20 per cent.”
Mr Hobbs advised another owner her property was probably worth $1.2 million, including “approximately a 20 per cent reduction in property values since the injecting room was established”.
Jellis Craig Richmond director Elliot Gill said the injecting room had affected prices “very near it” and was a hot topic among buyers and sellers.
“People are generally supportive of it but, from a real estate perspective, do you want to live next door?” he said.
“Some (buyers) look at the spot less favourably and others aren’t that bothered.”
Judy Ryan, of Residents for Victoria St Drug Solutions, dismissed the link between the injecting room and property prices, pointing to a downturn in suburbs across the city.
The median house price in Carlton dropped 25.4 per cent in the year to September 2019, Fairfield decreased 12.4 per cent, Mentone 15.8 per cent, Spotswood 10.9 per cent and St Kilda 6.6 per cent.
“These (North Richmond) decreases reflect overall market trends and can’t possibly be linked to the MSIR,” Ms Ryan said.
Megan Wahr and Richard Perry planned to fund their retirement by selling their Lennox St investment property and now fear the sale price won’t be enough.
Ms Wahr said agents had “for years” informally valued the property at up to $1.5 million but now advised it could sell for as little as $1 million.
MORE NEWS
OVERDOSE CALLS SOAR IN CITY’S HEROIN SUBURBS
HEROIN ADDICT SHARES HARROWING TALE MOMENTS AFTER OVERDOSING
POLICE TO PROBE SCHOOLGIRL TIKTOK VIDEO
“It has just been quite shocking to find out,” she said.
“I do agree with the injecting room but placing it right next to a school in the middle of an established estate is going to have consequences.”
Another owner said agents advised his property had dropped about 30 per cent.
“To sell now would be diabolically bad and I would have to take a financial hit,” he said.