Building a successful property investment portfolio often comes down to timing. Knowing the right time to buy, and where to buy at that given time is crucial.
Melbourne is shaping up to be a property hot spot this year. Here are three reasons why:
1. SEPP 65 will push property prices up
The State Environmental Planning Policy No 65 (SEPP 65) is the NSW Government policy regulating the design quality of residential apartment developments, and it’s coming to Melbourne.
The aim of the policy is to deliver a better living environment for residents and enhance streetscapes and neighbourhoods across the State. All development applications are assessed by council against the policies criteria to ensure they are SEPP 65 compliant.
Whilst enhanced living sounds like a fantastic outcome for Victorian residents, the result will be an increase in housing prices.
Melbourne architect and advocate of apartment living, Craig Yelland, told The Australia Financial Review he expects the introduction of SEPP 65 to increase the cost of every new Melbourne apartment by $123,000 on average.
The debate over whether SEPP 65 should be introduced to Victoria has raged for the past couple of years, but with the City of Melbourne council supporting its introduction it appears inevitable.
2. The Sky Train will ease traffic
The green light has been given to the construction of a new Sky Train network in south-east Melbourne that will reduce peak hour commuter times by an estimated 87 minutes.
The $1.6 billion project will replace nine level crossings from Cranbourne to Pakenham with five new stations built nine metres above the ground. It will create 2,000 new jobs and open up 225sq km of public land – that’s about 11 MCGs worth of space that could be converted into parks, playgrounds, sports fields and new car parks.
New and faster trains, better stations, and a faster drive to work or university are the key benefits for local residents. It has been estimated that individuals who drive into the city for work spend 87 minutes stopped at train boom gates during their 2-hour commute.
Improved infrastructure into the CBD, and increased recreational facilities, will likely attract residents to these southern suburbs.
Works on the Sky Train network are due to be completed before the election in November 2018. Learn more about the Sky Train project by watching a video by the Victorian Government posted on The Age.
3. Predicted growth greater than Sydney
Domain Group’s chief economist, Dr Andrew Wilson, has told The Sun-Herald he expects Melbourne’s growth to outpace Sydney’s over 2016 – 5 per cent to 2 per cent – as investor activity and median property prices increase in Melbourne.
According to the latest Domain House Price Report for the December quarter, median prices jumped 1.8 per cent in Melbourne, but dropped 3.1 per cent in Sydney. Looking at the past three years, Sydney’s median house prices have increased 53.6 per cent, whilst Melbourne has only experienced a 34.2 per cent increase.
Continued price growth is exactly what you want as a property investor, and buying before the growth hits is the perfect time to invest.
Want to know what properties we have available in and around Melbourne? Click here.