Sarah Oliver
Melton and Moorabool are the most reliable profit making markets in Victoria, with every home sold in those areas in the September quarter getting more than the original purchase price.
Head of research at CoreLogic, Eliza Owen, said data shows that of the 59 house sales in Moorabool through the quarter, and the 345 house sales across Melton, 100 per cent resold at a nominal gain through September.
The median profit for house sales across Melton was $216,000 while in Moorabool it was $247,500.
Ms Owen said the total stock levels are pretty low across both LGAs as new supply added to the market has not kept place with demand.
“In December of 2021, total advertised stock was 7.2 per cent lower year-on-year across Melton, and 15 per cent lower across Moorabool,” she said.
“Another growth factor for areas like Melton and Moorabool is that we are at a point in the housing cycle across Greater Melbourne where more demand pressure is being put on more affordable markets toward the fringe of the metropolitan”
A factor to consider is how the pandemic has affected the profit margin.
“The pandemic has not directly had much impact on the rate of profit-making sales, but rather the number of transactions,” Ms Owen said.
“When cities were in lockdown, people just physically weren’t as able to go out and inspect property, list their property or commit to purchases. In spite of this, low interest rates and a sense of buyer urgency meant that properties that did sell through the September quarter sold well.”
Looking ahead, Ms Owen said rising rates of profitability are likely to continue, but may peak in line with prices peaking some time in 2022-23.
“The idea that capital growth, and the chances of making a profit making sale, should peak over the next couple of years is based on the expectation that interest rates will rise, and affordability constraints are setting in for buyers across the market.”
