Victoria’s shock investor ‘no-go zone’

A surprising suburb has been revealed as Victoria’s shock single inclusion in a list of Australia’s top 25 investor “no-go zones”.

This two-bedroom townhouse at 3/16 Lorensen Ave, Coburg North, sold for $597,000 last month.

Coburg North’s unit market has been revealed as Victoria’s shock single inclusion in a list of Australia’s top 25 investor “no-go zones”.

Positive Property founder George Markoski, who authored the report, said there were too many apartments being developed in the northern suburb.

“There’s a massive vacancy rate, over 3 per cent, and over the past two years there has been a drop of rental properties, 50 per cent less available rental properties on the market,” he said.

“But even though we’re going through a rental crisis, Coburg North has got empty properties — that’s not a good sign. The days on market (it takes to sell) figure is also large.”

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Family buyers are the dominant force in Coburg North.

Coburg North has a large development area around the former Pentridge Prison site, while what local agent Lucas De Bartolo calls the Merlynston pocket is popular with families.
“In Coburg North, 80 per cent of the buyers are family buyers,” the Barry Plant agent said.
“It’s such a family-orientated area, and as someone who was born and raised in Reservoir and works out of the area, Coburg, Reservoir and Pascoe Vale, it’s the most community orientated and family orientated area out of all of them — especially the Merlynston area.”
Mr De Bartolo just sold a two-bedroom townhouse at 3/16 Lorensen Ave close to Merlynston station for $597,000 to first-home buyers who beat an investor.

A two-bedroom townhouse is also for sale at 7/848 Sydney Rd, Coburg North.

This one’s priced at $550,000-$595,000.

Mr Marsoski said traditionally maligned investor markets, units in the Melbourne CBD, Southbank and Docklands, were part of an “extended list” of “no-go zones”.
But PropTrack director of economic research Cameron Kusher actually expects the inner Melbourne unit market to weather the downturn storm the best.
“The rental market is going to be really strong and it’s only going to strengthen as more people from intra and interstate and overseas come to the city,” he said.
“Apartments in inner city areas are going to do well as investors start looking for that stock to capitalise on increasing rents.

A two-bedroom apartment at N1802/241 Harbour Esplanade, Docklands, is priced at $475,000-$520,000.

This two-bedroom apartment at 1313/228 A’Beckett St, Melbourne, is for sale for $550,000-$575,000.

“Also as more first-home buyers look to get into the market, probably the apartment is the stepping stone property at this point in time.

“There’s a lot of uncertainty around building a new home, so more will be looking to established properties in inner city areas, and also as interest rates rise and people can’t afford as much.”

Mr Kusher said apartments in those Docklands, CBD and Southbank markets would “do okay” but those in areas like Richmond and Carlton would be better placed.

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