Tenants struggling to find a home amid the rental crisis look to buy with affordable options enticing them to Melbourne’s western suburbs.
The rental market across Melbourne continues to challenge tenants with fierce competition and increasing home prices.
The combined capital city vacancy rate was 1.13% in June, which highlighted the shortage of properties to rent, with houses in Notting Hill in Melbourne renting the fastest, only lasting 14 days on market before being snapped up.
Advertised rental prices were also up by 43% for houses nationally between March 2020-April 2024, while unit rents rose 46% over the same period.
Melbourne's western suburbs: where space, community, and convenience come together.
With these hurdles to navigate, renters are looking for a way out, and buying is an option many are considering, according to Jackie Kent, Development Director at Stockland.
“It’s an exceptionally challenging time for renters with limited supply and rising costs across the board. So we're seeing a lot of first home buyers that are seeking to escape that uncertainty by purchasing their first home within a Stockland community,” she said.
Ms. Kent added that there are many benefits to buying instead of renting from the security it affords, the freedom in terms of making changes to the property, and the investment potential.
“The one we hear most often though from our first home buyers is the community pride aspect of buying into Stockland; you become part of a like-minded, vibrant community where you can put your roots down and connect with your neighbours,” she explained.
With affordable options across the western district including Mt Atkinson, Grandview, Grand Central, and Wattle Park, renters can enter the market for under $550,000* with several financial incentives from the government to further entice tenants.
Relocating from St Kilda to Mt Atkinson: Andrew and Teresa's experience
Andrew and Teresa, along with their dog Leo, relocated from a two-bedroom St Kilda apartment to a three-bedroom house in Mt Atkinson. They are delighted with both the area and the extra space.
"We have space for our hobbies and a backyard for more freedom", Andrew explained.
"Stockland did really well with the size of the blocks and the location." He enjoyed the lifestyle change, noting, "It's really chilled and everyone's really friendly here."
Buying a home can offer benefits such as security, the freedom to make property changes, and investment potential.
He appreciated Mt Atkinson's balanced lifestyle, stating, "It's close to shops and transport but feels a bit like nature with walking trails around the estate."
Teresa appreciated the community feel, saying, "Everybody meets at the park, where there’s all sorts of activities and a cafe.
"I take the train in the morning; it's just 10 minutes away and very convenient." She added, "We take the same train, which is comfortable and quiet, taking about 30 to 40 minutes to the city."
Knowing they won't be evicted provides stability and financial security, Andrew explained.
"Plus, it's great having a brand-new house covered under warranty."
"If you want a family-oriented lifestyle, this is the place. Stockland was the easiest choice with the best blocks and locations."
Teresa explained that it felt amazing to get the keys and move into their own brand-new house: "Owning a home means security and space.
"Moving from the city to our house with plenty of space is a huge relief."
Nesrin's journey from renting to finding home in Mt Atkinson
Nesrin also found Mt Atkinson ideal, saying, "It feels close to where we lived near the city, with open space, great for a growing family.
"Raising a family here is fantastic because of the diverse cultures and seeing lots of children with their families; parents, grandparents, at the playground."
She emphasised the prime location, explaining that living in the west is centrally located to different suburbs and the city.
Mt Atkinson's residents feel close to the city but can enjoy open spaces, great for a growing family.
Nesrin added, "I can see downtown from my house, which feels great".
She saw buying a home as a big milestone and felt backed by Stockland: "They helped us out with advice on buying land and building in stages."
"Renting was pricey, so getting our first home was a big deal."
She described the relief of owning a home after years of renting: "It was just a stressful thing. Being a renter and knowing that we might have to move out [at any time]." We were those people, we've been in that situation, she explained.
Finally finding a stable place has brought much-needed comfort for her family: "We feel relieved from having to move from home to home. And now with our first home, we just feel stable, relaxed, safe, and happy."
She added, "And seeing the joy and the happiness in my kids, them knowing this is their home, it just brings peace.
"We feel just like we've achieved something for our kids. It's a real sense of fulfilment."
Understand the first home buyer’s market
PropTrack’s Home Price Index for July showed that national home prices lifted further 0.08% across the country in July, to a new peak. In Melbourne, prices are at a median of $803,000, while in the rest of Victoria, they had a median of $587,000.
While rises in home prices isn’t great news for first home buyers, the announcement of the interest rate remaining at its 12-year high of 4.35%, gave buyers and sellers a slight boost in confidence.
“The stable interest rate environment has been a driver of confidence among buyers and sellers, while ongoing home price rises are likely incentivising many to overcome affordability challenges and transact with the expectation of further growth,” explained Senior PropTrack Economist, Eleanor Creagh.
First home buyers are also expected to have more money to spend on property from this month as the tax cuts come into effect, boosting borrower capacities.
Amid record-low rental affordability levels, as reported by PropTrack's rental affordability report, Stockland is prioritising affordability to attract first home buyers to the western suburbs.
Communities such as Mt Atkinson, Grandview, Grand Central, and Wattle Park are offering townhomes and house and land packages for under $550,000*.
Proactive steps for homeownership in 2024
Are you a tenant keen to get out of the rent race? Here's what you need to do:
1. Research the market
Renters looking to buy are encouraged to understand the market through research. Keeping up to date with what property is selling for through the ‘sold’ section of realestate.com.au is a great way to get started and follow property news to see how the market is trending.
2. Find your support team
A mortgage broker can help first home buyers understand their borrowing capacity and how to find a loan that will be the same monthly cost as paying rent, which means the main hurdle will be saving the deposit.
Once you get further down the path towards home ownership you'll also need other professionals such as a conveyancer or solicitor.
3. Know which Government grants can help
There are several government incentives to help renters get into the buying market sooner and many are geared towards those purchasing new homes as opposed to pre-existing.
In Victoria, these include the $10,000 First Home Owner Grant when you buy or build your first new home. There is also a stamp duty exemption which applies to the majority of Stockland’s homes, with stamp duty abolished for homes under $600,000.
Getting into a brand new home might be easier than many first think.
4. Discover how brand new homes can be more affordable than existing houses
Stockland regularly offer their own incentives to attract potential buyers.
These incentives can vary widely depending on the current market conditions, target demographics, and specific community goals.
Some common types of incentives include price rebates, where you could save thousands upon settling on your lot, or special pricing on homes or townhomes. They may also provide low deposit assistance, making it easier for buyers to secure financing and reducing the initial financial burden.
Explore Stockland's masterplanned communities in Melbourne's West.
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