Low interest rates, moderate house prices and high rental yields … it’s an investor’s dream and you don’t have to look too far.
Melton South has been dubbed Victoria’s top investment suburb by Domain Group after registering a median price growth of 7.9 per cent to $260,000 in the past year and a rental yield of 5.3 per cent.
In nearby Kurunjang and Melton, median house prices grew by 3.3 and 2.5 per cent, with yields at 5.1 and 5 per cent.
Domain Group’s senior economist, Andrew Wilson, said there had been considerable growth in Melbourne’s western and north- western suburbs in the past few years.
“People are realising these suburbs have reasonable amenities and local infrastructure, and it’s a good drive into Melbourne on roads that have been well designed,” Dr Wilson said.
“I think Melton is emerging with its own neighbourhood characteristics. It certainly has that sense of semi-rural environment.”
Dr Wilson said the booming property market drove the local economy and paved the way for local jobs.
“One of the things lifting the Melbourne economy, after the downturn in the manufacturing sector is the increase in construction jobs,” he said. “Melton’s part of that; a lot of the workforce is driven by construction.”
The municipality attracts many first-time buyers and young couples because of its affordability and semi-rural lifestyle, according to Dr Wilson.
“Melton South will continue to grow, particularly given that it’s an area exposed to people who are in the earlier stages of their career as home-buyers. It’s an attractive place to invest – and a growing community.”
More than a quarter of the municipality’s population is aged 18 to 34, according to the latest Australian Bureau of Statistics data
Principal real estate agent Brett Barrett, of Ray White Melton, said Melton South had room to grow. “The start-off price is very affordable.”
Mr Barrett said no other suburbs in Melbourne were within 25 to 30 minutes’ drive of the CBD and with homes selling for $260,000.
Last month, the Reserve Bank of Australia cut interest rates to an historic low of 2 per cent.
