Property investing: City of Melbourne named the “number one pick” for property investors — Hotspotting
Despite claims Daniel Andrews is “hell bent on discouraging” property investors, a real estate guru has named the City of Melbourne the best place to buy.
The City of Melbourne has been named the “number one pick” for property investors, despite accusations Daniel Andrews is “hell bent on discouraging” them.
Real estate guru Terry Ryder has picked the municipality where apartments and townhouses make up 86 per cent of homes as a “game changer”, with big opportunities for buyers looking for affordable options.
The Hotspotting founder said Melbourne’s market was showing considerable buoyancy and had strong prospects for capital growth.
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Reduced affordability and changing lifestyle demands were leading more investors to look at apartments instead of homes which Mr Ryder said was a “game changer” and “big shift” in sentiment.
His latest Hotspotting report for Melbourne indicates the city’s next home price uptick is gaining pace, with the number of suburbs that have had three consecutive quarters of increasing sales volume up nearly five-fold from 12 to 58.
It is one of the key metrics he assesses for future home price growth.
Recovering suburbs, turning a corner after sales numbers slumped, have quadrupled since the March quarter; and the number in decline has tumbled from 67 to just nine.
Mr Ryder highlighted the cities of Melbourne, Hume, Monash, Melton and Whitehorse as his “hot spots” for property investment in Greater Melbourne, with special attention suburbs from Docklands to Mitcham and Craigieburn to Caroline Springs.
He added that low unemployment, prosperity in the community and the state’s economy continuing to be “pretty strong” were the bigger forces at play keeping the property market viable.
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Mr Ryder said rising rental prices was further incentive for investors to home in on the city.
But he warned that a looming increase in land taxes had the potential to be very destructive to the property market and the state government needed to be “very careful” it didn’t make investment into the city “so unattractive” investors turned away.
“(Dan Andrews) seems hell bent on discouraging anyone from ever wanting to buy a property in Victoria,” he said.
Buyers advocates have revealed they’re actively advising investors to take their money interstate for “better value” as Melbourne’s median home prices remain one of the highest in the country at $938,000 for houses and $631,000 for units.
Lux Buyers Agents director and buyers advocate Rob Panetta said his first preference for property investors was to look interstate for “better value” and a better government landscape.
“(Melbourne) has one of the highest median values out of all the capital cities, it’s a bit unaffordable for a lot of people,” Mr Panetta said.
“We’re seeing people invest interstate at the moment, either Perth or (regional) Queensland.
“(Dan Andrews) is not really encouraging a lot of investors to get into the market in Melbourne.”
Barry Plant Glenroy principal Fadi Khoder echoed Mr Panetta’s concerns for Melbourne’s property market, and said in his 23 years in real estate, he’d never seen so much property come on the market from investors selling their rental properties.
“A lot of people are choosing to offload investments because they're just getting unviable to hold,” Mr Khoder said.
However, he said Broadmeadows, Dallas and Meadow Heights were still affordable suburbs for investors.
Similarly, Mr Panetta said Broadmeadows within the Hume municipality was an affordable suburb to get into the market for a budget under $600,000.
“Eventually down the track it is going to gentrify and has a lot more going for it in such proximity to the city,” he said.
“I don’t see it not growing in value.”
Mr Panetta also said his other “hot spots” for a budget of around $800,000-$1 million were Coburg North and Pascoe Vale South.
“Coburg North is very affordable right now,” Mr Panetta said.
”You’re getting older family houses that you can add a bedroom or a bathroom or something to create some equity and potentially go again and buy something else.”
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sarah.petty@news.com.au
Originally published as Property investing: City of Melbourne named the “number one pick” for property investors — Hotspotting