12 Collins Close, Keilor East, recently sold for $826,000 – but the suburb could be in for a home price growth spurt, according to John McGrath.
The head of one of Australia’s largest real estate firms has tipped Victoria for a population-driven home price recovery in 2025.
And Melbourne suburbs at the heart of it are expected to include Keilor East, St Kilda East, Glen Waverley, Altona North and Spring Gully in Bendigo, with agents in one of the suburbs revealing the only thing holding it back was its name.
In McGrath Real Estate’s annual property market report, boss John McGrath has flagged that the state’s population rising at one of the nation’s most rapid rates at the same time as constraints on the number of tradies available to build homes is slowing housing construction.
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Despite this, recent PropTrack data revealed median home prices fell in hundreds of Melbourne suburbs in the past year.
The city’s clearance rate has also declined since the start of 2024, when it was hovering between 65 per cent and 70 per cent. Yesterday PropTrack data shows it reached 62 per cent from 809 reported results.
Mr McGrath said population growth and home building constraints, along with a number of infrastructure improvements and expectations of an interest-rate cut, would “no doubt see the city’s housing market bounce back”.
Keilor East tops his list of suburbs to benefit in the new year as the prospect of a new train station under the Melbourne Airport Link combines with good access to major freeways, lifestyle destinations and proximity to Highpoint Shopping Centre.
PropTrack figures show the area has a $1.045m median house price, making it likely to benefit from buyers who had been priced out of more expensive neighbours.
16 Rockbrook Rd, St Kilda East, sold recently for $1.535m, and gives an idea of the kind of three-bedroom home the money buys in the suburb.
St Kilda East got the nod as a convenient area that has reasonable access to the beachside amenities of its busier neighbour, St Kilda, but with more of a suburban feel.
Art Deco-style homes, including apartments, were singled out as expected to be particularly high on buyers’ shopping lists. The area has a $1.7m median house price, but the typical unit is more affordable at $575,000.
McGrath St Kilda principal Michael Townsend said St Kilda East was the perfect blend of family and fun, but was too easily overlooked because buyers associated St Kilda with a grimy reputation.
“But if you called it Caulfield West, it would be very different,” Mr Townsend said.
“It is more affordable than almost any of its neighbours, has great public transport and is still a $5 Uber from Chapel St or the Espy.”
5/378 Inkerman St, St Kilda East, sold in January for $574,000, but could be worth more if the suburb’s name were changed according to one of the agents involved in the sale.
4 Oxley Close, Glen Waverley, sold for $1.4m earlier this month – but the suburb could be in for a growth spurt in 2025.
A combination of top schools, both Monash and Deakin universities nearby, as well as a wide array of restaurants, shops and transport options are behind Glen Waverley’s short-listing.
Mr McGrath also noted that the prospect of inclusion on the Suburban Rail Loop could also start to influence home prices in the area.
A middle-of-the-road house in the suburb costs $1.689m, though units are half that at $880,000.
Altona North made the list for its lifestyle offerings and proximity to Port Phillip Bay, but more affordable prices than nearby suburbs. Families are also tipped to appreciate the area in the new year thanks to a $930,000 median house price as well as easy access to Scienceworks and multiple local sports centres.
242 Mason St, Altona North, recently changed hands for $1.01m, but there are predictions the suburb’s home values could soon rise from there.
$437,000 was enough to buy this home at 164 Retreat Rd, Spring Gully, in August – but it’s possible the new year could bring higher prices to the suburb.
The Bendigo suburb of Spring Gully was Mr McGrath’s final tip, and made the list after it’s home prices rose in the past year.
The chief executive said he still believed there was room for the $650,000 median house price to grow further, particularly given it was on the Melbourne side of the regional city.
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