Melbourne Housing affordability: Where homebuyers can buy a house with a $50k deposit

1 week ago 10

This three-bedroom house at 3 Buna St, Heidelberg West is listed for sale for $590,000-$640,000.

Victorian househunters on a tight budget can still make a move in Melbourne’s property market, with new research highlighting the top suburbs for buyers with deposits as low as $50,000.

Canstar and Hotspotting research research firms named 10 suburbs where homes can still be bought for tens of thousands dollars less than the city’s $914,000 median house value and still within an hour of Melbourne’s CBD.

One million Vic households found to be in financial stress

Aussie suburbs where home prices are set to crash

The spotlight is on Epping, Sunbury, Heidelberg West and Seaford — where typical house prices are under $860,000, and buyers can offer a 10 per cent deposit of $86,000 or even less.

Families searching for a home with only $50,000 to spend upfront could snag a property in Melton South, where a typical house is $489,000.

A two-bedroom unit at 4/7-8 Portsmouth Place, Epping which sold for $481,500.

Hotspotting founder Terry Ryder said it showed it was still possible to purchase a family home with less than a $100,000 deposit in Melbourne, especially as a first-time buyer with access to government assistance.

“You’re better off getting in the market now if you can get in with a 5 or 10 per cent deposit and paying mortgage insurance,” Mr Ryder said.

“If you wait and keep saving until you get 20 per cent, in that time, the market can move, so you’re just playing catch up all the time.”

Mr Ryder said buyer demand was rising for well-located and affordable apartments, as well as houses in Melbourne’s outlying areas such as Epping and Seaford.

Hotspotting and Canstar also pointed to Melbourne city, Parkville and Brunswick West, or close to the CBD as the best and most-affordable suburbs to snap up a unit, with typical apartment prices under $500,000.

This two-bedroom apartment at 702/67 Galada Ave, Parkville is on sale for $480,000-$510,000.

In regional Victoria, Mr Ryder said it wasn’t essential to buy within commuting distance to Melbourne, as many people worked remotely or because they were strong, regional cities in their own right.

“Many of the suburbs in Ballarat still have median prices in the $400,000s for houses; generally speaking, you just can’t find that anymore in Melbourne,” he said.

“It’s pretty attractive buying for people who don’t have an absolute need to be in Melbourne.”

Canstar money expert Effie Zahos said the prevailing theme among the markets accessible for buyers on tight budgets was that they had a larger supply of flats, townhouses and apartments.

“Units tend to represent a much more affordable entry point into the market and the sad fact is that house prices are running away compared to units, so units offer value,” Ms Zahos said.

“In some suburbs, it is surprising just how high the premium is for (freestanding) houses over units. In the most extreme cases, the premium can be as high as 70 per cent.”

A two-bedroom townhouse at 4/3 Cook Court, Sunbury which sold for $458,000.

But Your Australian Property buyer’s agent Zac Newbold warned it was “critical” for purchasers to buy an A-grade property if they were only putting down a 5 per cent deposit.

“Buyers who are looking at a property for $500,000 to $550,000, should stick to metropolitan Melbourne; where you have the population, industry, work opportunities,” Mr Newbold said.

“Homes out in areas like Bacchus Marsh and Wallan, there is no infrastructure.”

Cinch Loans managing director Arnab Baral said depending on a person’s eligibility, government grants and other forms of assistance made it possible to purchase a home in some parts of Melbourne with a $50,000 deposit — especially for first-home buyers.

“In Victoria, to be specific, if you are trying to purchase a property which is less than $600,000 then you do not have any stamp duty — so that’s a big expense gone,” Mr Baral said.

“Or if you earn as a couple below a certain threshold; you can get up to a 95 per cent loan of the purchase price of the property without paying lenders mortgage insurance.”

He added that in the western suburbs especially, it was possible to purchase a three-bedroom house below $600,000.