Bundoora, Carlton, Southbank, Docklands, Melbourne’s CBD and Abbotsford are among the only suburbs in Melbourne where it’s cheaper to buy than rent, data by a big bank shows.
But buyers in these areas, which also include Windsor, Werribee and Dandenong, will have to settle for a unit instead of a full-sized home, with Melton and Melton South the only metropolitan locales where buying a house was more affordable than renting.
National Australia Bank data released this week revealed the number of Victorians who thought now was a good time to buy hit its lowest point in 12 months in the June quarter.
Just over three in 10 Victorians surveyed by the bank thought now was a good time to buy a home, down from a peak of almost five in 10 in the December quarter.
And the figure for those who planned to buy in the near future was even lower, with just 13 per cent of Victorians flagging plans to buy in the next 12 months.
NAB executive of home ownership Andy Kerr said buyer sentiment had taken a hit due to skyrocketing house prices.
But the data showed options were still available in metropolitan areas for low-income households, and rock-bottom interest rates and government incentives had helped first-home buyers in particular get a foot on the property ladder.
No. 10/2 Dixon Court, Boronia, recently sold for $772,000.
“I think buyer intent is a little bit subdued on the back of the impact of house price rises we’ve been seeing in the past six to nine months,” Mr Kerr said.
The data includes suburbs where it was deemed cheaper to service a mortgage than pay rent, assuming an 80 per cent loan-to-value home loan ratio and an interest rate of 2.69 per cent over a 30-year term.
Mr Kerr said the suburbs highlighted provided great value for the city if buyers were happy with unit living.
The NAB survey noted it was still necessary for some homebuyers in Sydney and Melbourne to move further out from the CBD or even to regional areas in order to find properties in their price range.
But metropolitan areas still had pockets of opportunity, with Melton and Melton South the best options for those who had their heart set on buying a house.
No. 3 Arable St, Werribee, sold in August for $675,000.
The Greater Geelong suburbs of Corio and Norlane were also good hunting grounds for homebuyers where buying a house was cheaper than renting.
The data showed capital city house prices shot up 14 per cent nationally since September last year, leaving them 12 per cent higher than where they were in February 2020 before the pandemic hit.
But Nab predicts house price growth will cool in the coming months.
“From here we see the monthly pace of growth slowing, but continuing at a solid rate, with dwelling prices up around 18.5 per cent in 2021 and 3.6 per cent in 2022,” the survey noted.
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MEDIAN SALE PRICE DATA
(Year to August)
Bundoora units – $415,000
Carlton units – $469,999
Southbank units – $565,000
Docklands units – $586,500
Dandenong units – $398,000
Werribee units – $395,000
Windsor units – $571,000
Melbourne CBD units – $530,000
Abbotsford units – $591,875
Melton houses – $425,000
Melton South houses – $490,000
Norlane houses – $419,000
Corio houses – $415,00
Source: realestate.com.au
