Why you should consider investing in Melbourne

With its renowned sporting and festival culture, trendy cafés and great value property, Melbourne might very well be an investor’s dream.
Mark Ribarsky

Melbourne has captured the hearts of people around the world. It’s led the way with a sporting and festival culture, trendy cafés and great value property.

Investors around Australasia recognise the steady 20-year growth of property prices in Melbourne, low rental vacancy rates and attractive median house prices in comparison to Sydney.

They also leverage from the Australian’s love of real estate. Every major TV network across Australia has a real estate show. Aussies love to renovate property, build new houses and now, subdivide.

The Australian dream of owning your own home is still very much alive and creates a lot of interest around real estate. All this interest in property pushes prices upward, keeping growth strong and steady

Melbourne TownhousesThe Reserve Bank of Australia summarises the last 30 years of residential property in the following ways:

  • In the 1980s, “housing prices grew broadly in line with general price inflation in the economy.”
  • The 1990s until the mid 2000s saw “relatively strong housing price growth associated with a significant increase in the debt-to-income ratio of Australian households.”
  • Since the mid 2000s, “strong population growth has played an increasing role in explaining housing price growth.”

While history shows Melbourne is a great state to buy in, as an investor, it all comes down to knowing how to buy the right property in growth suburbs.

Hence, the rise of professional real estate buyers. Known as buyers agents, they are real estate agents that represent the best interest of their clients: property buyers.

Once reserved only for the wealthy, buyers agents have become a much more common way for wannabe home owners to step onto the property ladder.

Working in the real estate market on a daily basis, they are able to come across opportunities and identify value for their clients.

As the founder of Wise Real Estate Advice buyer’s agency, I believe success in property investing is about buying the right investment property – something that attracts tenants when leasing and buyers when re-selling.

The Australian Bureau of Statistics has recorded Victoria as the fastest growing state in Australia, with 143,000 new residences in 2017 alone.

The reason tenants love Melbourne is five-fold:

1. Metropolitan areas close to CBD

Metropolitan areas only sit as far out as 50km from the CBD. No matter which direction you travel, you’ll find freeways, highways and other major roads to create easy access to the city.

Melbourne Flinders Street Railway Station2. High employment rate

Melbourne’s unemployment rate is consistently low at 5.5-6.5%. It is no wonder, as some of the world’s biggest companies have offices in the CBD: think BHP, Google, PwC, Exxon Mobil and the major banks, just to name a few.

3. Government investment in major infrastructure

Billions of state and federal dollars are being invested into major infrastructure of roads and rail, creating many jobs in the process. This year, Melbourne began taking on some of the biggest road and rail projects in its history, with the Westgate Tunnel Project, North East Link Project, the Mordialloc Bypass, Whitten bridge upgrade and the Metro tunnel – adding to the city’s liveability and adding more jobs in the process.

4. A sport and leisure capital

Melbourne features some of the biggest sporting events in the world, from the Australian Open to the Melbourne Cup and Formula One and, as a result, drawing in thousands of local and international tourists.

5. The Paris end

Melbourne often gets compared to Paris, because, well, it feels like Paris! The inner suburbs share a café culture, creating a strong attraction for tenants.

Mark Ribarsky
* Three year fixed rate, owner occupier, P&I loan with a maximum LVR of 95% and a loan amount >$150,000. Lender rates and products may change. We cannot suggest you remain in or switch to any loan until we complete our assessment. Fees and charges apply. ^ WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. The comparison rate is calculated on the basis of a loan of $150,000 over a term of 25 years. ± All loan applications are subject to uno assessment and lender approval. uno does not guarantee that it will be able to find a customer a better loan than the one they currently have or to save them money.