It has been a strange time for real estate in Melbourne’s CBD. Well, I suppose it would be more accurate to say that it has been a different strange to the oddness that we’ve become accustomed to. After all, the question of whether to buy or what the future prospects of Melbourne’s Central Business District would be have always been slightly hazy. Melbourne is a major city, after all, and boasts one of the best reputations for quality of life of all the big metropolitan cities.
Because of this, accommodation in the form of apartment buildings have popped up all over the place, with many now seeing it as a saturated market, and many also see it as a fantastic opportunity to get in early in something big. However, we’re getting ahead of ourselves. Today, we’re taking a look at Melbourne’s real estate investment, and whether the current situation as of 2021 has made it a viable option for investors.
With lockdowns making it difficult for many to maintain their employment and practically impossible for international students to enter the country, we’ve seen some stark changes to Australia’s property markets, especially with regards to rentals. This has led to average prices, both rental and purchasing, dropping quite significantly across the board, and in turn, a number of owners looking for ways to recoup these losses.
Because of this, Melbourne’s city council has begun urging young buyers to buy within the area and take advantage of the current affordability. Rather than framing this as a dire situation, the council sees this instead as an opportunity to bring some new life into the precincts and start on an exciting post-pandemic path. According to Zenith, over half of first homebuyers surveyed would consider Melbourne as a viable place to purchase, so Melbourne city’s attempts may not be falling on deaf ears.
Melbourne’s city council aren’t the only one touting real estate in Melbourne’s CBD as a viable opportunity. Industry specialists have spent the past few months discussing whether Melbourne’s inner suburbs may be an incredible investment hidden in plain sight. After all, with prices soaring since 2010, this is the first time that many of central Melbourne’s areas and properties have been a legitimate investment option for many Australians. So, as life returns to normal and people begin to return to the city for work, fun and travel, we’re likely to see those prices increase significantly as per previous estimates and trends.
However, whilst estimates do suggest that purchasing in the city makes for good investments, this doesn’t necessarily mean that experts are suggesting this for the new apartments that have become so prevalent in the area.
Small apartments are always going to be a point of contention within investment circles, as whilst they are often the only option in sought after areas, there’s little room for, well, growth. These properties are not without their benefits, as they provide ample rental opportunities to students and single workers in the city, but their small size and short life on the property ladder have not made them as attractive as those looking to sell them likely hoped.
This isn’t to say that they should be avoided by investors, however, but simply that there are factors to consider when purchasing to ensure the long-term viability of properties like this. These factors include location, style, views, amenities, and of course, the asking price.
While it’s easy to focus all attention on the central Melbourne market, expanding out slightly into surrounding areas shows a much more varied picture of rental opportunities. Places like Carlton have been shown to offer incredible opportunities, with homes coming in at under $1 million, all within walking distance of the CBD. So, if you’re new to the property world and want to get started with real estate in Melbourne’s CBD, you have a lot of options available to you. Just make sure you get in quick if you’re wanting to get in on the current opportunities before prices start to go back to normal.
Want to learn more about real estate in Melbourne? Want more tips and tricks regarding the world of property management? Explore the My Rental blog today and stay up-to-date with everything we have to offer.
Keep up to date with our experts' latest investment strategies and property management tips. If you are looking for any case studies or further information about the greater Melbourne area, speak with our property managers today.
Better property management starts here. Get your no obligation free rental appraisal and property report.Get free report