Melbourne’s housing market is set for a monster comeback with almost two thirds of suburbs now on an upward trajectory, and battler ’burbs tipped for “supercharged” price growth.
A rise in sales activity in Sunbury has the area in Melbourne’s north west ranked as the nation’s top spot for a lift in house values this year.
Craigieburn, Werribee, Caroline Springs, Hoppers Crossing and Deer Park have also been tipped for a boost.
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Respected property pundit and the author of the Price Predictor Index, Terry Ryder, has also earmarked units for “supercharged” gains across suburbs including Docklands, Hawthorn East, Richmond and St Kilda.
All told, the Hotspotting.com.au founder believes a whopping 63 per cent of all Melbourne’s suburbs are now positioned for growth, and that the city is now the third best positioned region nationwide to grow in value in the year ahead.
Only Darwin and regional South Australia are better placed for mass growth across their suburbs and towns.
25 Alexander Court, Sunbury, is up for sale at $895,000-$980,000 in the suburb ranked most likely to see growth nationwide.
Werribee also made the “supercharged” list of suburbs, with 79 Tindale Blvd listed for $730,000-$790,000.
In his latest Price Predictor Index, Mr Ryder used a 16.4 per cent rise in sales activity across the city as a metric to track increasing demand that is likely to underpin rising prices in the near future, with bigger things expected for areas like Sunbury that have had sales surge from 140 a quarter early in 2023 to 250 in the final three months of 2024.
It follows a surge in investor sales over the past few years that had the city’s home values flat or falling from early 2022 until the tail end of last year.
Hotspotting founder and property analyst Terry Ryder.
Mr Ryder said Melbourne’s recovery had been “quite a long time coming” after limited growth and even home value losses in various parts of the city at a time when other capitals had been rising.
“But the sales activity shows that things are improving,” he said.
“It’s the beginning of a strong upward trend, and relative to other cities Melbourne is now very attractively priced.
“In a years time, we should see Melbourne doing much better than recent years.”
Craigieburn has had one of the biggest increases in sales numbers around the country in what is generally considered a pre-cursor to home price growth. At present, a three-bedroom house like 15 Birdswood Cres would set you back $570,000-$610,000.
A $700,000-$770,000 budget could get you a home at 44 Arroyo Place, Caroline Springs, another suburb that has recorded a significant rise in sales numbers.
The property pundit added that there were already signs of rising investor activity, and alongside population growth increasing homebuyer and renter demand, broad growth was looking likely within the next six to nine months.
Mr Ryder added that with limited new supply being built some of Melbourne’s long-term affordable unit markets, such as apartments in Docklands, were likely to experience growth as a result of buyers who wanted a home they could lock up and leave for convenience — not just something affordable.
“And now the construction industry doesn’t have the capacity to build the number of apartments that Melbourne and other places need, or it’s too expensive to build them. And that puts a floor under the value of existing ones — and therefore prices are rising.”
Raine and Horne Sunbury’s Amanda Burt said the suburb’s property market had already “changed significantly” compared to a year ago.
A budget to cover $640,000-$670,000 would get you a home like 4 Earlsferry Lane, Deer Park, where house prices are tipped to soon rise.
Home prices are also expected to lift in Hoppers Crossing, which could be good news for the buyers of 17 Kathleen Cres. It is currently listed for sale at $620,000-$640,000.
“Buyers are coming from Airport West and Niddrie, where they can’t afford the homes anymore, but they see Sunbury is still 35 minutes from the city,” Ms Burt said.
The agent said sales had surged again since the interest rate cut, and future cuts were expected to drive even more activity.
In many instances, those who owned homes were now selling up to buy larger properties in the area or neighbouring suburbs such as Riddells Creek.
Real Estate Institute of Victoria president Jacob Caine said there was a growing list of data points heralding a home price lift for Melbourne in 2025.
“When you look around the country, you see that Melbourne prices are comparatively affordable, but while Melbourne and Brisbane have historically traded places as the second most affordable capital, there’s only so long Melbourne ever slips back,” Mr Caine said.
“The fundamentals of living in Melbourne and Victoria are just so strong.”
2/1 Smith St, St Kilda, is listed for sale with a $675,000-$695,000 asking price that gets you a two-bedroom floorplan today.
A one-bedroom apartment at 403/20 Peel Street, Collingwood, will set you back $590,0000-$630,000 today — but later this year it could be worth more.
Behind rising home sales numbers being observed by Mr Ryder, the agent said the city’s blend of lifestyle, a strong economy as well as cultural and sporting attractions that consistently made it a draw card for population growth, underpinning long-term home value rises.
PropTrack senior economist Anne Flaherty added that Melbourne’s comparative affordability to other major capitals would help underpin the city as a leader for migration both internationally and from interstate, putting further upward pressure on home values this year.
“And, on top of that, Melbourne has a very diverse economy, with a lot of opportunities for jobs,” Ms Flaherty said.
“So Melbourne is ticking a lot of boxes for where people might want to live right now.”
Supercharged Suburbs – Houses – median price
Caroline Springs – $735,000
Craigieburn – $650,000
Deer Park – $666,500
Hoppers Crossing – $620,000
Sunbury – $670,000
Werribee – $610,000
Morwell (regional Victoria) – $340,000
Two bedrooms and an expansive urban view will set you back $580,000-$590,000 for a home like 1606/100 Lorimer St, Docklands, today. But sales numbers are rising in the area, and it’s been tipped this could lead to price rises.
Supercharged Suburbs – Units – median price
Brunswick East – $535,000
Collingwood – $619,000
Docklands – $615,000
Hawthorn East – $577,500
Richmond – $579,999
St Kilda – $505,000
St Kilda East – $610,000
Source: Hotspotting.com.au Price Predictor Index
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