20 Melbourne suburbs that have bottomed out, now positioned for best price growth | Suburb Data

The Melbourne areas where home prices have reached their lowest and are now gearing up for future price growth have been revealed. Is your area among them?

2/147 Waiora Rd, Heidelberg Heights, is on the market with a $690,000-$720,000 asking range. The area is one of 20 that Suburb Data have ranked on their price growth hot spot list.

Home prices in 20 Melbourne suburbs have hit bottom and are poised for a come back in 2025 as interest rates buoy homebuyer confidence.

While experts warn against trying to time the market, those ready to make a move today could be set for future windfalls from units in enviable suburbs from Mentone to South Yarra, as well as affordable hubs around Sunshine and Craigieburn.

The figures from real estate researchers at Suburb Data also ranked houses in Kalkallo in Melbourne’s outer north as heading into prime time for buying.

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But it was mostly units, including townhouses and apartments, that dominated across Victoria’s capital.

Suburb Data examined every Australian suburb by the ratio of property demand to supply.

This was determined using a range of metrics such as online engagement on listings, the average time it takes homes to sell, auction clearance rates and listing volumes, among others.

These figures were contrasted with the recent trajectory of price growth.

Suburbs were labelled as “bottoming out” if falls in prices had slowed, with demand growing and supply shrinking.

This three-bedroom townhouse at 117/ 1-15 Beddison Rd, Craigieburn, is for sale with a $420,000-$462,000 price tag. The suburb has a median $404,000 unit price, incorporating townhouses and apartments, according to realestate.com.au’s research arm PropTrack.

With two bedrooms, this unit at 6/1 Rockley Rd, South Yarra, has a $520,000-$550,000 asking range. The inner city suburb has a $550,000 median unit value.

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Areas were given scores out of 100, with 100 being most favourable for price growth.

Melbourne suburbs to score above 70 for their units’ demand to supply ratios included top-ranking Mentone, with South Yarra, Sunshine, Forest Hill, Craigieburn, Altona, Richmond, Newport and Laverton also on the list.

According to PropTrack, median unit prices in these suburbs vary from Craigieburn’s $404,000 to $740,000 in Forest Hill – although a three-bedroom unit in South Yarra has a median $1.38m value, and the same sized home in Richmond comes with a $1.1895m median.

Suburb Data analyst Jeremy Sheppard said the Melbourne suburbs showing signs of hitting bottom represented a safer bet in the city’s falling housing market.

“They may not return to growth immediately but these are suburbs where demand is at least beginning to pick up again and the falls are slowing,” he said.

“Prices could skim along for a while but the conditions in these suburbs suggest the declines are finishing.”

A double-storey, two-bedroom townhouse at 2/14 Station St, Mentone, is on the market with a $650,000-$700,000 range. It features an upstairs living area and powder room, single garage with internal access and a reverse-cycle split system.

The kitchen is fitted with stone benchtops, a walk-in pantry and Blanco appliances, plus a breakfast bar.

Melbourne-based buyers’ advocate Emily Wallace said that Mentone offered great-entry level opportunities for first-home buyers and investors, with bonuses including the suburb’s beachside location, train station and proximity to Southland shopping centre.

She advised buyers hoping to secure a unit that would increase in value to look for properties with a courtyard or outdoor area with space for dining; a second toilet if there was only one bathroom; and a hallway that provides a more “house-like” feel.

She said apartments in boutique blocks were generally preferred to larger complexes.

“With apartments in South Yarra, people tend to want older-style apartments that are traditionally larger,” Ms Wallace said.

“People say they don’t want to live in a shoebox.”

She also advised buyers to set aside $3000-$4000 a year for an apartment’s body corporate fees and $2000-$3000 for a unit or townhouse.

Priced at $750,000-$800,000, this three-bedroom townhouse at 2/8 David St, Altona, in Melbourne’s western suburbs is located 350m from the beach.

This apartment at 10/75 Hotham St, Balaclava, has been listed with $540,000-$590,000 price hopes. The suburb in Melbourne’s inner south is among the top 10 Melbourne areas that Suburb Data has included on its list.

Ray White – The Bayside Group’s Greg Brydon said Mentone’s units and townhouses were popular with first-home buyers and downsizers, who had sold a house in the area but wanted to stay there.

“Single-level, two-bedroom villa units that are renovated and in a block of eight homes or less are the hottest market you can get at the moment,” Mr Brydon said.

The agent added that Mentone’s well-regarded schools also made it popular with young families.

“It is affordable but you still get incredible value for money compared to other properties within a 15-minute radius,” he said.

The Covid lockdowns of 2021 and 2022 also led to generally flat prices in the suburb, but there are signs they are now on the move.

“We would expect to see an average of 7 to 10 per cent growth, if not more than that year on year going forward,” he said.

Located at 105/281 Tooronga Rd, Glen Iris, this two-bedroom apartment is another of the areas on Suburb Data’s Melbourne top 20 list.

MELBOURNE SUBURBS POISED FOR A COMEBACK

Mentone (units): $607,500

South Yarra (units): $550,000

Sunshine (units): $403,500

Balaclava (units): $555,000

Officer (units): $497,500

Notting Hill (units): $347,500

Forest Hill (units): $740,000

Craigieburn (units): $404,000

Altona (units): $700,000

6 Litoria Way, Kalkallo, a three-bedroom house listed for sale with a $619,000-$649,000 asking range, is in a suburb that’s 31km north of Melbourne’s CBD.

Richmond (units): $573,500

Heidelberg Heights (units): $712,500

Glen Iris (units): $747,500

Lilydale (units): $590,000

Port Melbourne (units): $720,000

Newport (units): $737,000

Laverton (units): $520,000

Kalkallo (houses) $637,072

Southbank (units): $600,000

Docklands (units): $615,000

Surrey Hills (units): $873,000

Figures show median price for suburb.

Source: Suburb Data, PropTrack

-Additional reporting by Aidan Devine

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Originally published as 20 Melbourne suburbs that have bottomed out, now positioned for best price growth | Suburb Data