Middle-ring suburbs in Melbourne’s east lead decade of property price growth

The median house price for metropolitan Melbourne shot from $345,000 in 2006 to $635,000 in 2016, a rise of $290,000 or 84 per cent, the Valuer-General’s latest A Guide to Property Values report reveals.

But at least 30 of the 422 suburbs grew by almost double this figure, and some by even more.

Middle-ring suburbs, 10 to 20km from the CBD, led the charge.

One top performer, Box Hill South, saw its median grow more than $800,000 over the decade from $444,000 to $1.25 million, an increase of 182 per cent, the Valuer-General’s data showed.

Meanwhile Box Hill North’s median grew 171 per cent to reach $1.12 million, and Blackburn and Mt Waverley had 172 per cent rises to medians of $1.23 million and $1.265 million respectively.

Real Estate Institute of Victoria president Joseph Walton said REIV data also showed significant price growth in middle-ring eastern suburbs.

“Many of these suburbs appeal to both local and foreign buyers, offering quality infrastructure and amenities as well as proximity to the CBD,” Mr Walton said.

Top performing public schools were also a key driver in these areas, he added.

Elsewhere, Doncaster’s median house price rose 169 per cent in the decade to 2016 to hit $1.348 million, the Valuer-General’s data showed. Nunawading grew by 167 per cent to reach $962,500.

Southeast suburbs in the middle ring saw strong growth, too. McKinnon’s median shot up by more than $1 million in the decade from $634,500 to $1.678 million — an increase of 165 per cent — while Bentleigh rose 158 per cent to reach $1.38 million.

CoreLogic state director Geoff White said growth in McKinnon and Bentleigh had been driven by improvements in infrastructure, and were now considered part of the city’s premium market.

“McKinnon is also driven by McKinnon Secondary College; there are parts of McKinnon where people will pay 20 per cent more to get into the school zone,” he said.

Mr White said population growth and affordability were key factors that had driven price growth across the city throughout the past decade, as buyers looked to areas where their budgets could still provide them with access to infrastructure and amenities.

In the west, Footscray’s median price rose 127 per cent from $340,000 to $772,500 in the 10 years.

Mr White said Footscray’s growth was more recent, with buyers drawn to its affordability compared to suburbs the same distance from the CBD on the other side of the city.

And while much of the east and southeast had shone in terms of price growth over the past decade, other parts of the city would soon get their turn, if auction activity was a yardstick, Mr White said.

“I do think the north to northwest is going to be somewhat of a focus,” he said.

“We’re starting to see good action in Broadmeadows, Altona and Werribee. And Deer Park, Mill Park, Hoppers Crossing, they are all areas that get very high clearance rates.

“Where a large number of auctions are being conducted and clearance rates are high — 80 to 100 per cent — you have to say it’s an area being focused on by buyers and is likely to see price growth in the coming years.”

Reservoir, Preston and Bayswater were also strong auction performers, he added.

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