What is your home worth: REIV median house prices reveal which suburbs are ‘on special’

Melbourne’s housing market has taken a backward step, putting many former million-dollar suburbs on special, with more on the cusp. See what your suburb is worth.

Once million-dollar Melbourne’s suburbs are going on special as the city commences a market correction that is giving buyers a chance to get more bang for their buck. Picture: Tony Gough

Melbourne’s housing market has taken a backward step that’s put 21 once million-dollar suburbs on special, giving buyers a chance to get in without the seven-figure price tag.

The Real Estate Institute of Victoria’s latest quarterly median house price data shows the typical metropolitan house price fell $32,000 (2.9 per cent) to $1.081m in the three months to June 30.

The REIV figures reveal more than 20 suburbs from Altona North to Watsonia have dropped out of the million-dollar club in the past year.

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Dozens more could soon slip below seven figures, with Mitcham enduring a 22 per cent decline from $1.29m to $1.005m since March — the largest drop of any Melbourne suburb with at least 30 sales in the quarter.

But REIV president Richard Simpson said those that lost their status wouldn’t be down for long.

“If they have been there before, they are likely to be $1m neighbourhoods again in the future,” Mr Simpson said.

“They aren’t, in my view, going to lose ground permanently. So they are a good opportunity to get in now.

“And if you are buying and selling in the same market, especially upsizing, then you will get better value for your money.”

He added that while the Institute is predicting home prices will decline about 3-5 per cent over the next year, it won’t be the “doom and gloom” scenario some are predicting and the vast majority of Victorian homes were still worth more than a year ago.

“Over the past two years the median house price has grown 23 per cent,” Mr Simpson said.

“We’re in a really unprecedented interest rate scenario. But once interest rates do stabilise, we think housing will as well — and start an upward trend.”

He added that with the building sector under pressure and international migration returning there were also a number of factors working to slow home price falls.

All suburbs had a median house price of at least $1m within the past 12 months.

Some suburbs recorded fewer than 30 sales in the June quarter, which can yield more volatile median prices. Quarterly median prices may differ from annual figures as the latter captures sales from 2021.

However, lenders are not so positive, with a NAB Economics survey revealing the number of Victorian’s who think now is a good time to buy fell from 25 per cent in March to 21 per cent at the end of June.

NAB home ownership executive Andy Kerr said it was “unsurprising in an environment of rising interest rates” and noted the about 11 per cent of Victorians intending to buy a home in the next 12 months was the equal lowest number since they began the surveys in 2020.

Mr Kerr said while interest rate rises were reducing buyers’ budgets, declining prices would also give them greater ability to buy — though it was possible some would hold off waiting for even better conditions.

But an increase in places for the federal government’s First Home Guarantee Scheme could see demand for the more affordable end of the market rise, he added.

NAB’s latest home price forecasts indicate Melbourne house prices should end the year 7.7 per cent down from the start of 2022. A further 14.1 per cent decline is tipped across 2023.

WHY WE’RE SELLING

Garth Turnbull and wife Hayley Chalmers-Robinson, as well as their kids Jack, 2, and Hamish, 5, are selling up in Reservoir. Picture: Jason Edwards

Garth Turnbull and Hayley Chalmers-Robinson are selling 59 McMahon Rd, Reservoir.

For Garth Turnbull and his partner Hayley Chalmers-Robinson, the decision to sell their Reservoir home was less about Melbourne’s market and more about a sea-change.

With Hamish, 5, Jack, 2, and their two parson russell terriers Flash and Peggy, needing more space they‘re planning to relocate to Torquay, renting at first, but eventually buying.

They’ll be sad to farewell the two-bedroom 1950s-built home at 59 McMahon Rd where their family has been growing since 2019, but are following a wave of friends who have already made a coastal move.

The home’s updated interior has been a perfect setting for early family life.

“In summer we spent a lot of our time sitting out under the tree, having a drink with the kids running around,” Mr Turnbull said.

While the market “doom and gloom” had left them a little conflicted about selling, they could see a positive.

“While there’s not a lot of people in the market, there’s also not as many homes for sale,” he said.

Ray White Preston director Ian Dempsey said while the Reservoir area remained popular and some homes were still selling well, buyers were better off than they had been — particularly unrenovated ones.

Renovated homes are typically selling better than unrenovated homes in the suburb.

“Buyers aren’t paying a premium at the moment,” Mr Dempsey said.

“They are still there, but they are being picky.”

But those looking for an upgrade, particularly those currently in a unit or smaller home, were still looking to sell.

“You’d rather be upgrading in a downturn market than in a market that is rising,” Mr Dempsey said.

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