Melbourne Property Investment

Figures from the Australian Bureau of Statistics indicate that over the next 30 years, Melbourne's population will increase by around one million, with an estimated overall household growth of 627,000 and 90% of additional dwellings accomodating just one to two people.

The State Government's answer to morphing lifestyles is a programme known as "Transit Cities". The thirteen designated "Transit Cities" are Box Hill, Dandenong, Footscray, Broadmeadows, Werribee, Sydenham, Epping, Frankston, Ringwood, Ballarat, Latrobe Valley, Bendigo and Geelong. Designated urban improvements have occured in such places as Box HIll and Frankston resulting in more activity on the streets and over time, with more people living in the "Transit Cities", there will be increased activity and vitality in all the centres. It needs to be recognised that this is a long term plan about the revitalisation of these areas and a general decentralisation in Melbourne's local demographics.

Melbourne's property investment over the next five years will have essentially three major factors: The Docklands development and city rebirth, key roadworks - mostly in Melbourne's east - the new planning system Melbourne 2030. Experts generally agree that Melbourne Property displays all the right fundamentals for long-term investment growth.

Looking Ahead...

Despite the slowing property market, Victoria remains one of Australia's most unaffordable states when it comes to buying a house.

A recent report from the Real Estate Institute of Australia and AMP, found that housing affordability in Victoria was at a 12-year low.

The Housing Industry Association's chief economist, Simon Tennent, said that with interest rates on the rise, affordability was likely to keep deteriorating well into 2007.

For property investors, these factors are simply part of the property cycle and should not discourage investors from entering the property market if their financial situation allows them.

Top Performing Suburbs

Given the combination of higher rates, new auction rules and early signs of a slowdown, Melbourne's market is likely to be driven by a return to quality and location. Locations to consider would include some of the "Transit Cities" mentioned above.

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