Melbourne’s long-term property market prospects are among the best in Australia, with our city tipped to be Australia’s biggest capital by 2030.
While we are emerging from one of the most turbulent years in real estate history, many experts expect the market will stabilise in 2023.
Rapid interest rate rises quickly replaced the pandemic as the biggest factor impacting Australia’s property market, with the Reserve Bank raising interest rates again in December at its final 2022 meeting.
While some rate increases may be ahead, the big four banks are predicting that we are near the peak, after which house prices could stabilise.
CoreLogic figures show Melbourne’s property prices dipped by 1.2% in December, which is a drop of 8.3% from their peak in early 2022.
Noel Jones Director Michael Hill said it was important to look at the broader market context.
“This period has followed record growth during the pandemic and a housing affordability crisis,” Michael said.
Australia experienced the fastest rise in property prices on record between 2020 and May 2022, with home values growing almost 30%.
“Since then, we’ve had the first interest rate rises in years and stock levels are up from very low levels in 2020-21.”
Even with these factors at play, realestate.com.au reports there is still strong demand from buyers and clearance rates in December hovered around 70%, which is usually associated with a strong market.
The recent Westpac-Melbourne Institute House Price Expectations Index also shows most consumers believe house prices will rise in 2023 rather than fall.
“The future is bright for Melbourne’s property market,” Michael said.
“We still have solid demand and that will only grow with an increased population, so this could be an ideal time to upgrade your home or enter the market before more rapid growth.”
Noel Jones was thrilled to close out December with great results for our vendors across Melbourne’s east. A three-bedroom home in Blackburn sold for $1.8m – almost half a million dollars more than the suburb’s median price.
A three-bedroom home in Wantirna South sold just two days before Christmas for $1.05 million, safely above the suburb’s median.
Many Noel Jones suburbs were standout performers in 2022, including Canterbury and Deepdene. SQM Research data revealed plenty of activity in Canterbury over the last 12 months, with 172 properties sold.
Around 50 homes changed hands in Deepdene in the past year, with the highest sale fetching $7.3m.
While property prices have taken a recent hit, rental values keep climbing, with Melbourne’s median rent at $507.
CoreLogic data shows annual growth of almost 10%, mostly driven by the combination of high demand and low supply.
A growing number of interstate and international migrants to Melbourne is likely to keep demand high.
“Our inner eastern suburbs a popular choice for new arrivals given their great lifestyle perks,” Michael said.
In some exciting local news, the Eastern Food Rescue is the December grant recipient of the Noel Jones Community Support Program.
The volunteer group has operated a free-access pantry in Mitcham since mid-2021 to support struggling locals and stop food going to landfill. The funds will help Eastern Food Rescue expand. Visit www.noeljones.com.au/communitysupportprogram to find out more.
If you’re considering your next property move in 2023, the Noel Jones team is just a call away.