Top new hospitals around Melbourne are tipped to add significantly to home prices in surrounding areas. Picture: Grace Frost.
Billions of dollars spent on Melbourne hospital upgrades have been tipped to take pockets of the city’s struggling housing market off life support.
New analysis suggests major health precinct projects in Footscray, Frankston and Melton could also significantly improve the health of the property market in surrounding suburbs.
The three have been named on a list of the nation’s 10 most likely healthcare projects to push up home values nearby in a report titled From Wards to Wealth completed by property market guru and Hotspotting co-founder Terry Ryder and Fresh Start Advisory.
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Across the wider state there are another 80 medical precinct projects worth more than $100m individually either being built or planned, including in Warrnambool, Geelong, Ballarat, Epping, North Melbourne, Heidelberg, and a $535m expansion of the Monash Medical Centre in Clayton.
Mr Ryder said it was “no coincidence” that Frankston’s housing market was one of Melbourne’s most successful at the moment.
The $1.1bn Peninsula University Hospital was completed there last year and the suburb’s median price has surged 11 per cent to $838,000 in the past 12 months.
The Frankston hospital redevelopment is believed to have already boosted home values.
Home prices have already soared in Frankston, where 3 Dulgai Court is currently for sale at $750,000-$820,000.
Neighbouring Frankston North’s $695,600 typical house is fetching 16 per cent more than it was a year ago, and in Frankston South there’s been a 19 per cent surge in the $834,000 median unit price.
He also noted strong results at auction across the area.
“There’s no doubt that the Frankston area has done well,” Mr Ryder said.
“These sorts of projects do stimulate property markets.”
With Victoria’s housing market having struggled for some time, the property pundit said Melbourne was now far cheaper than it should be by national standards – and there was a good prospect areas with new hospital projects would help lead to its recovery.
The recently completed new Footscray hospital has generated significant numbers of local jobs — and demand for housing. Picture: Grace Frost.
West Footscray prices could soon be taking off as a result of the hospital nearby, with 33 Braid St currently for sale at $850,000-$900,000.
The recently opened $1.5bn Footscray Hospital is yet to make a dent in the suburb’s $917,000 median price for its immediate surrounds — though the number of sales in the suburb has risen significantly in what is usually a precursor to a rise in values.
In neighbouring West Footscray prices are up 5 per cent at $990,000 for the past year, while nearby Maidstone’s $867,000 median gained 9 per cent.
Woodards Yarraville director Leo Dardha said there had already been an increase in nurses, doctors and other health professionals inspecting homes in the area around the hospital with nearby Maribyrnong also attracting demand due to its lifestyle offerings.
While the homes being sought did vary, two-bedroom townhouses under $800,000 were a common target, as were houses up to $1.5m.
An artist impression of the new design for the new Melton hospital.
The Melton hospital site under construction in April this year. Picture: NewsWire/ David Crosling.
“And while there’s a lot happening in the economy and around the globe right now, my prediction is that in the next 18 months it will have moved,” Mr Dardha said.
“So buyers need to be active and front and centre now, while it’s still a buyers market.”
The $1.5bn Melton Hospital precinct will be Australia’s first fully electric hospital, though isn’t expected to open until 2029.
Despite this, Cobblebank, the suburb that will host the suburb, has already had an 11 per cent increase in its median house price to $610,000.
Melton and Melton South are also gaining ground with a 9 per cent up tick to $539,000 and $567,500 respectively.
“Investors seeking long-term growth are well advised to follow the hospital infrastructure trail, which is widespread throughout regional and capital cities in Australia,” Mr Ryder said.
Maidstone has had a strong run in price growth, 23 Deakin St is now for sale at $850,000-$900,000.
Fresh Start Advisory chief executive Frank Ambesi said the wide range of staff associated with hospitals often created demand for everything from luxury homes through to affordable houses and apartments.
“Suburbs surrounding medical infrastructure are magnets for renters and buyers who want to live close to where they work,” Mr Ambesi said.
“Hospital infrastructure development has a long-lasting impact on real estate markets – because while there may be thousands of jobs in the construction phase, there are more in the ongoing operational phase.”
Health Precincts That Could Boost Home Prices
PENINSULA UNIVERSITY HOSPITAL
Suburbs to watch:
Frankston (1117 sales): $838,000 median house price (11%); $565,000 median unit price (3%);
Frankston North (142 sales): $695,600 median house price (16%);
Frankston South (381 sales): $1.21m median house price (6%); $834,000 median unit price (19%);
Langwarrin (471 sales): $885,000 median house price (4%); $650,250 median unit price (12%);
FOOTSCRAY HOSPITAL
Suburbs to watch:
Footscray (650 sales): $917,000 median house price (-2%); $450,000 median unit price (-8%);
Kingsville (109 sales): $1.255m median house price (6%); $422,000 median unit price (-5%);
Maidstone (241 sales): $867,000 median house price (9%); $625,000 median unit price (3%);
Seddon (98 sales): $1,075,500 median house price (-2%);
West Footscray (277 sales): $990,000 median house price (5%); $425,000 median unit price (-10%)
A $509,000-$529,000 home like that at 45 Plover St, Melton, could soon be worth more.
MELTON HOSPITAL
Suburbs to watch:
Brookfield (233 sales): $610,000 median house price (11%);
Cobblebank (119 sales): $631,500 median house price (-1%);
Melton (232 sales): $539,000 median house price (9%); $410,000 median unit price (8%);
Melton South (354 sales): $567,500 median house price (9%); $390,000 median unit price 6%);
Sales numbers reflect 12 month period, percentages show 12 month home value change
Source: From Wards To Wealth (Fresh Start Advisory, Hotspotting).
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