According to the data released by Australia’s famous real estate research institution SQM Research, as of 2017, the vacancy rate of all capital cities in Australia has been falling, falling by 0.1% in the fourth quarter and 0.2% in the whole year. Among them, Melbourne’s housing vacancy rate dropped to 1.8%, while apartment rental and listing prices rose 4.5%, showing a very bright performance.
This set of data is sending a message to global investors: Australia’s housing market continues to be hot, and Melbourne’s real estate is a quality product with appreciation potential and investment value.
Since August 2016, Australia’s cash rate has remained at a historical low of 1.5%, and it is predicted that it will continue to maintain a low interest rate of 1.5% in the future. Lower cash rates mean more liquidity in the market and an increase in the number of real estate transactions. This is one of the important factors that will continue to increase the overall price in Australia.
All along, Melbourne’s housing prices have maintained a strong upward trend. In recent years, housing prices in many regions have shown rocket growth. According to CoreLogic data, there are 609 suburbs where the average housing price is over 1 million in Australia, Melbourne has 141 suburbs where the average housing price is over 1 million which up to one third in total. And five years ago, there were only 30 suburbs where the average housing price is over 1 million in Melbourne. Today, more and more those suburbs are in west region of Melbourne. It is predicted that in the next few years, multiple districts in the Western District will soon join the ranks of millions of urban areas.
The real estate appraisers Tony Kelly said that the Melbourne market will be more stable than other Australian markets because of strong population growth. He said: “This factor is driving the Melbourne market. This is a major driver in the past few years.” Oster said: “The central bank will begin to cancel some of the emergency stimulus measures because the current economic situation really does not require these measures.”Tony Kelly, director of property valuation firm Herron Todd White, said that because Melbourne’s population has grown rapidly, it is stronger than other markets in Australia. This factor has injected strong momentum for the market, which has been the case for the past few years.
The Times reported that within the five years of the 2016 Australian Census, a total of 485,220 residents had moved to Melbourne, most of whom were from other parts of Australia or overseas. Currently, Melbourne is the fastest growing capital city in Australia. It is expected that it will surpass Sydney by 2031 and become the largest city in Australia.
The explosion of population has brought about huge housing demand. However, the volume of housing approvals in Victoria has decreased. BIS predicts that the start of construction of Victorian apartments will be significantly reduced. From the peak of 2015 (nearly 19,800 units) to the lowest level in 2021 (about 7,200 units), Melbourne’s housing market will face a serious shortage and housing prices will further increase.