Where Is The Best Place To Buy An Investment Property In Melbourne?

What To Look For In Suburbs With High Growth Potential

You should begin your search for an investment property in Melbourne by eliminating areas that lack all but one of the following criteria:

• Property values are on the rise.
• Changing demographics of a neighbourhood
• A lot of fixing up going on.
• Increases in auction sales figures
• When the number of days a property spends on the marketplace (DOM) goes down, it indicates that it is selling faster.
• Increases in rental income
• A shortage of available housing
• Extensive construction of local infrastructure is in the works.
• Initiatives to create new jobs in the region are in the works.

The ideal suburb would include as many of these features as possible. It's worthwhile to recap the previous performance of a Melbourne market before delving into the specific suburbs that provide good investment opportunities.

Melbourne Real Estate Market Performance In 2021

• All Houses, Year-to-Date: 8.1%
• House: +9.4%
• Units: +6.5%

While Sydney's market saw double-digit increase, Melbourne's overall home sales were up only 8.1% in the first eight months of the year (YTD). Median home prices increased by 1.8% in May, bringing quarterly growth to 5.5%, to $740,562.

If you're in the market for a home, the fact that this is about $200,000 cheaper than the median home price in Sydney is good news.

Real estate in Melbourne continues to fetch record prices despite the challenges of the current COVID period. Included in this are condominiums, which have lagged behind single-family homes but are still at all-time highs thanks to a +2.2% increase in median valuation during the March quarter, bringing it to $568,793.

CoreLogic, an analysis firm specialising in real estate, attributes the "persistently robust demand for housing" to rising confidence in the economy and low loan rates.

Best Melbourne Suburbs To Invest In 2021

According to data collected over the past year, the number of investors participating in the Australian real estate market is at an all-time low.

Melbourne was hit harder by the epidemic than any other Australian metropolis in 2020, what does that suggest for the city's investment prospects in 2021?

Investors who have remained on the sidelines may want to reconsider their stance now that the property market is expanding thanks to massive government support, record low borrowing rates, and rising investment value.

Regional locations within commuting distance to Melbourne CBD have begun to gain momentum as a job movement continued to sweep from across the State, along with a desire to prevent returning to the bustling city lifestyle.

To that end, which Melbourne neighbourhoods provide the best return on investment? We've selected the best suburbs in the area:

Officer

Officer, a tranquil and rapidly growing suburb of Melbourne, can be found in the city's south-east. Officer has traditionally been popular among homebuyers because of its proximity to railway stations, the Princes Freeway, and some of Melbourne's finest schools. The median property price in Officer is $593,000*, and the rental return is 3.5%.

Arcadia, located in the office, is a highly sought after master-planned community by Satterley. The intriguing estate makes the most of its stunning natural setting while also providing convenient access to the city. Arcadia is a great choice with competitive investment potential due to its proximity to a planned town centre, two adjacent train stations, and three brand new schools.

Melton

Melton is continuing its ascent in Melbourne's real estate market while remaining in the west and shifting somewhat to the north. The median home price in the area is $390,00*, and its economy has grown faster than any other in Victoria during the previous decade. This has led to Melton's recent surge in popularity among house-hunters.

Located about 45 kilometres from the heart of Melbourne, the area is easily accessible by the city's major arterial roads. These include the Tullamarine, Cumberland, Western, Princes, and Hume Freeways. Even without the anticipated population increase of 40% over 40 years, Melton's long-term value is obvious.

Mickleham

Investors and potential homeowners should seriously examine the rapidly expanding and highly sought-after neighbourhood of Mickleham. With a median home price of $578,000* & rental returns of approximately 3.77%, this suburb is a terrific possibility for investors looking for a place for expanding families.

Within a ten-minute drive, you can reach the Craigieburn centre, where you'll find a wide variety of stores, gyms, schools, and restaurants. With a projected yearly growth rate of 28.92%, Mickleham's population, which was just over 3000 at the time, is forecast to soar to over 40,000 by the year 2026.

Chatterley's Botanic estate can be found at Mickleham, which is 29 kilometres from the central business district and is readily reached by automobile via the Tullamarine Freeway or by train from the neighbouring Donnybrook Railway Station.

Box Hill

Box Hill is one of the most modern and top-performing suburbs in the Australian real estate market. Located 20 kilometres from the central business district, its proximity to cutting-edge medical facilities, academic institutions, and employment possibilities may account for its recent surge in market value.

Box Hill, a well-established growth region in Melbourne's eastern suburbs, is a strong contender for our top suburbs list after achieving an investment income of 20.84% over 2020*.

Tarneit

The lush suburb in Tarneit has grown steadily over the years due to its proximity to Werribee and the bay. Recent predictions put population growth in Melbourne's western region at 12%, comfortably above the 10% average for metropolitan areas.

Tarneit, with a typical home price of $603,000* and a location just 25 kilometres from Melbourne's central business district, is a rapidly developing suburb. At Habitat at Davis Creek, one of Satterley's proudest deliveries, one of Tarneit's most sought-after communities, only a few lots remain.

Pakenham East

Pakenham, which is 54 kilometres south-east of Melbourne's central business district, is one of the city's most populous and rapidly developing suburbs in recent decades. As this sought-after area nears capacity, Pakenham East, a recently developed community nearby, is seeing an uptick in interest from homebuyers.

When completed, Pakenham East will add 7,200 new, affordable dwellings to Victoria's housing stock, as well as produce over $1 billion in economic activity and 1300 new employment.

There will be a town centre, three elementary schools, a middle school, a high school, 3 community centres, and 44 hectares of parks or sporting reserves available to residents. Both the starting price and the selection of property will be excellent bets in terms of long-term profitability.

If investors are looking for a new area with high demand and high expected rental yields, Pakenham East could be an excellent option. The fact that a number of reputable builders have shown interest in Pakenham East, Melbourne, suggests that many people see it as a promising location for future development.

Donnybrook

Take the Donnybrook Road exit off the Hume Freeway and find out why it's gaining in popularity. Donnybrook, located in northern Melbourne, is a thriving community.

There will be five nearby town centres, five utility centres, six school systems, four quasi schools, and 46 hectares of parkland, all of which will connect to the neighbouring suburb of Woodstock.

Donnybrook station recently underwent modifications that increased accessibility, safety, and passenger comfort, highlighting the importance of infrastructure development in one of Victoria's fastest-growing districts.

Greenvale

Located close to Melbourne Airport and boasting amenities like the Greenvale Reservoir, Recycling is an important Shopping Centre, and a 10-hectare athletic zone, Greenvale has long been considered a desirable community in Melbourne's north. This long-established and family-friendly neighbourhood, located only 24 kilometres from Melbourne, experiences consistent strong housing demand.

Investors in Greenvale and the greater north of Melbourne will find what they're searching for in Chatterley's True North community. The gorgeous estate is unrivalled as a residential neighbourhood due to the abundance of city vistas.

Glen Waverley

Located 19 kilometres south-east of the Central Business District, Glen Waverley is primarily a residential suburb with significant commercial sections concentrated from around Glen Waverley Train Station. As a suburb with a median house price just over $1.3 million*It's easy to understand why landlords have little trouble finding tenants. The Glen Shopping Mall, Glen Waverley Golf Course, and Central Reserve are all within easy driving distance.

The greatest public high school in the area, Glen Waverley Secondary College, is a major appeal for families looking to relocate to the area. For many years, families and investors in Australia's real estate market have been drawn to this very desirable neighbourhood in large part due to the quality of its schools.

Geelong

Geelong, one of Australia's fastest-growing regional cities, is a thriving yet laid-back community that offers enticing lifestyle alternatives just an hour from Melbourne. Geelong, a port city on Victoria's southern coast and the starting point for visitors to the region through Great Ocean Road has long been on the radar of Melbourne real estate investors.

With a median home price of $788,000*, excellent links to Melbourne, and a breadth of public infrastructure not typically found inside a regional area (sea, train, road, and air), Geelong is an attractive option for those looking to relocate. For instance, at the end of 2022, ship Spirit of Tasmania will call Geelong Port its new home.

Geelong's long-term and short-term investment attractiveness will be bolstered by assets like these, making the city a more attractive destination for businesses of all stripes.

We believe these are all the Melbourne neighbourhoods most positioned to capitalise on the city's transformation, whether you're a first-time investor or intending to make a large investment.

As time goes on, it becomes increasingly apparent that the higher and much more affluent areas of Melbourne are where real estate values will rise the fastest.

Population expansion will also cause the prices in the more affordable suburbs just on the city's periphery to rise temporarily. However, we still don't advise investing in these places because we anticipate weaker future capital growth for properties in such suburbs.

Most Affordably Priced Melbourne Suburbs For Property Investment In 2021

Great real estate investment opportunities might be found in some of Melbourne's most reasonably priced neighbourhoods in the year 2021. With the correct location, you can enjoy low initial costs, high rates of growth, and reliable rental yields.

Melbourne's current average dwelling price is approximately $740,562; therefore, we're looking for a neighbourhood with a price tag that's lower than that.

If you're looking for the best places to invest around Melbourne in 2021, our comprehensive list has you covered across the board, from trendy hangouts for students to quiet residential areas perfect for starting a family.

Crossing Of Hoppers

The conveniently located suburb.

• Home prices average $565,000.
• At $410,000, the median price of a home,

Hoppers Crossing, like Tarneit, has a lot of things going for it, especially for children and well-established, older couples who don't need to reside in the heart of the city. It's only 23 kilometres from the bright lights of the city, in case you need them. As of right now, the middle price of a home is $410,000, while the upper price is $565,000.

Houses inside the suburb rental for $350 a week, making them a good investment, while apartments return $315 per week. Over a five-year period, the area's median house price has increased by 7.8 percent, while the median condo price has increased by 6.4 percent, similar to that of neighbouring suburbs.

Craigieburn Investing

a northern suburb of Melbourne that is popular with families.

• Home prices average $580,000.
• $415,000 as the mean price per dwelling

Despite its rapid growth, you can still find reasonably priced real estate in Melbourne's outer-north neighbourhood of Craigieburn, which was once considered part of the country. The area is primarily made up of housing developments, and it has a very relaxed atmosphere thanks to all the parks and sports centres.

In today's market, the median cost of a one-bedroom apartment is $405,000, while the median cost of a four-bedroom house is $580,000.

Houses typically return 3.6% annually in rental income, while apartments return 4.5-5.0% annually. Over the past five years, house prices have increased by 8.0% and apartment prices have increased by 3.1%.

Werribee

Locations where buyers can purchase homes for under $550,000.

• To buy a home in the median price range of $540,000
• A typical home costs $400,000

Werribee, halfway between Geelong & Melbourne, is a desirable place to live thanks to its proximity to the water, a zoo, a winery, scenic parklands, a large shopping mall, and the beach. It's convenient for both families and professionals thanks to the nearby express train to the city centre.

Surprisingly, both houses and apartments still cost less than $600,000 on average here. Werribee rental properties fetch $350 per week on average, resulting in a gross annual yield of +3.4%.

The average weekly rent in the area is around $315, resulting in a rental income of +4.1 percent. Werribee's house prices have been appreciating at a healthy +9.7 percent annually, while unit prices have been rising at a more modest +6.6 percent.

Dallas, Melbourne Investing

Cheap investment homes for less than $500,000

• Home prices average $488,000.
• Common Price: $421,000

From what we've seen, the northern suburbs of Melbourne are the best bet for getting the most for your money. In Dallas, the median home price is $488,000, while the median condo price is $421,000. Popular with the young, families, and the elderly due to its proximity to the airport, in addition to the Coolaroo & Upfield train stations, and to the Hume Highway, which leads directly into the city centre (18 km distant).

The average rental yield for houses in Dallas is +3.7% per year, while the average rental yield for apartments is +3.8% per year. The five-year growth rates are likewise encouraging, with houses increasing by +8.5% and apartments by +8.3%.

Croydon, Melbourne

Family and student friendly green environment

Estimated Median Home Price in 2016: $825,000.

Standardised median price: $620,000.

Croydon, located in Melbourne's eastern suburbs, is known for its lush, relaxed lifestyle, excellent schools, and breathtaking Dandenong Ranges scenery. The neighbourhood is well-liked by families and young adults because it offers exceptional value despite being slightly more expensive than the regional median.

The median house price in the city is $825,000, while the median apartment price is $620,000. You may earn $400 per week by renting a unit with a rental income of +3.4 percent, whereas you can earn $450 per week with a house with a rental income of +2.8 percent.

In Croydon, houses have a CAGR of +4.9%, while condos have a solid CAGR of +5.7%.

Conclusion

Melbourne's real estate market will appreciate double digits into 2021. Melbourne house prices grew 5.5% quarterly and 8.9% annually, according to Corelogic data. Melbourne flat prices rose 4.7% annually. Melbourne's housing market has grown due to government support, record-low borrowing rates, and increased investment value. We've selected the top suburbs within driving distance of the city for you (and return on investment).

Melton Mowbray, Box Hill, Pakenham, and Tarneit are popular Melbourne neighbourhoods. Melton has 3.77 per cent rental returns and a median property price of $578,000*. By 2026, Micklehams will have 40,000 residents. Several reputable construction businesses have eyed Pakenham East. Donnybrook, in Melbourne's north, is bustling and thriving.

Greenvale, north of Melbourne, has always been nice. True North in Chatterley is unmatched as a residential neighbourhood for its city vistas. Many people visit the Great Ocean Road from Geelong, a large port in southern Victoria. Geelong's median property price of $788,000* makes it a wonderful place to move. Even in the cheapest suburbs, prices will rise.

Werribee, North Melbourne, has many families. Over the past five years, home prices rose 8.0% and apartment prices 3.1%. One-bedroom homes average $405,000, while four-bedroom homes cost $580,000. Melbourne's northern suburbs are the best value. Croydon is a popular relocation option due to its lush, laid-back atmosphere, top-notch education, and beautiful natural beauty. Dallas apartments cost $620,000, while homes cost $825,000.

Content Summary

• Even as underperforming months of the previous year fall off the rolling averages, Melbourne will see solid double-digit capital growth for 2021. However, apartment prices in Melbourne only increased by 4.7% in the past year.
• However, the Melbourne real estate market has a lot of room for development and expansion.
• Over the following year, we anticipate a 10-12% increase in the city's housing market, with single-family homes continuing to outperform apartment units.
• There is currently more growth in home prices than in unit prices in Melbourne.
• From a historical perspective, the Melbourne real estate market has been among the best in the world during the past four decades.
• In the past four decades: The annual rate of rise for the median Melbourne home price is 7.9%.
• You should begin your search for an investment property in Melbourne by eliminating areas that lack all but one of the following criteria: Property values are rising.
• It's worthwhile to recap the previous performance of a Melbourne market before delving into the specific suburbs that provide good investment opportunities.
• CoreLogic, an analysis firm specialising in real estate, attributes the "persistently robust demand for housing" to rising confidence in the economy and low loan rates.
• According to data collected over the past year, the number of investors participating in the Australian real estate market is at an all-time low.
• We've selected the best suburbs in the area: Officer, a tranquil and rapidly growing suburb of Melbourne, can be found in the city's southeast.
• Investors and potential homeowners should seriously examine Mickleham's rapidly expanding and highly sought-after neighbourhood.
• Box Hill is one of the Australian real estate market's most modern and top-performing suburbs.
• Box Hill, a well-established growth region in Melbourne's eastern suburbs, is a strong contender for our top suburbs list after achieving an investment income of 20.84% over 2020*.
• The lush suburb in Tarneit has grown steadily over the years due to its proximity to Werribee and the bay.
• Tarneit is a rapidly developing suburb with a typical home price of $603,000* and a location just 25 kilometres from Melbourne's central business district.
• If investors are looking for a new area with high demand and high expected rental yields, Pakenham East could be an excellent option.
• The fact that some reputable builders have shown interest in Pakenham East, Melbourne, suggests that many people see it as a good location for future development.
• Investors in Greenvale and the greater north of Melbourne will find what they're searching for in Chatterley's True North community.
• The greatest public high school in the area, Glen Waverley Secondary College, is a major appeal for families looking to relocate to the area.
• Geelong, a port city on Victoria's southern coast and the starting point for visitors to the region through Great Ocean Road, has long been on the radar of Melbourne real estate investors.
• Most Affordably Priced Melbourne Suburbs For Property Investment In 2021 Great real estate investment opportunities might be found in some of Melbourne's most reasonably priced neighbourhoods in the year 2021.
• Over five years, the area's median house price has increased by 7.8 per cent, while the median condo price has increased by 6.4 per cent, similar to neighbouring suburbs.
• A northern suburb of Melbourne that is popular with families. Despite its rapid growth, you can still find reasonably priced real estate in Melbourne's outer-north neighbourhood of Craigieburn, which was once considered part of the country.
• Houses typically return 3.6% annually in rental income, while apartments return 4.5-5.0% annually.
• Over the past five years, house prices have increased by 8.0%, and apartment prices have increased by 3.1%.
• Locations where buyers can purchase homes for under $550,000 To buy a home in the median price range of $540,000, A typical home costs $400,000. Werribee, halfway between Geelong & Melbourne, is a desirable place to live thanks to its proximity to the water, a zoo, a winery, scenic parklands, a large shopping mall, and the beach.
• Surprisingly, both houses and apartments still cost less than $600,000 on average here.
• On average, Werribee rental properties fetch $350 per week, resulting in a gross annual yield of +3.4%.
• Cheap investment homes for less than $500,000 From what we've seen, the northern suburbs of Melbourne are the best bet for getting the most for your money.
• The average rental yield for houses in Dallas is +3.7% per year, while the average rental yield for apartments is +3.8% per year.
• Family and student-friendly green environment Croydon, located in Melbourne's eastern suburbs, is known for its lush, relaxed lifestyle, excellent schools, and breathtaking Dandenong Ranges scenery.
• The median house price in the city is $825,000, while the median apartment price is $620,000.