Melbourne’s real estate market has been making headlines due to its outstanding sales results. The ongoing pandemic did not hinder the market’s progress, as more and more people are investing in properties. Melbourne’s booming real estate market has been seen as an opportunity to buy, sell, or invest in real estate properties.
Real estate properties continue to be in demand, and with the record house sales results in Melbourne, it’s no wonder why people are talking about this city’s real estate market. With property prices skyrocketing, it’s becoming more and more challenging to enter the market, but that didn’t stop people from taking advantage of the opportunity.
Inventory of Properties for Sale
One of the elements that fueled the booming real estate market in Melbourne was the decreasing level of inventory of properties for sale. With a staggering 38.2% fall in property listings, people scrambled to take hold of the available units. This scarcity results in a significant increase in property prices. The decrease in supply, along with the high demand, adds pressure to potential home buyers to put in an offer quickly.
Influx of Buyers from Overseas
The pandemic did not slow down international migration and buyers. Melbourne became even more desirable for property investments due to its excellent status as a city with high quality of life. Australia’s economy is stable, and this factor is vital for potential buyers looking into sustainable investments. As such, foreigners who seek a decent return on investment have been purchasing properties in Melbourne’s premium areas.
The Impact of Low-Interest Rates
Low-interest rates were also significant in driving the real estate market in Melbourne to where it is now. During the pandemic, interest rates plummeted, resulting in a more affordable borrowing cost. With low-interest rates, purchasing a property became more accessible to first-time homeowners, allowing people to upgrade their current homes, and investors to invest in more properties.
The Rise of Auction Sales Strategy
Auction sales become more popular than ever during the pandemic. It’s a sales tactic that has been around for quite some time, but it’s effective when done correctly. In Melbourne, auction sales were an excellent method for selling properties, as it allowed sellers to get the most out of their homes. Many buyers could bid on the property, allowing for a fair chance in securing their dream home. With its popularity, properties with auction sales got swooped up in a matter of days, resulting in quick turnovers.
What Can You Expect When Buying a House in Melbourne?
Property Prices in Melbourne
As of June 2021, Melbourne’s median house prices rose to $974,397, and unit prices were $598,387. Although prices have been increasing, Melbourne’s property prices are still comparably lower than that of Sydney.
Location Matters
Location is significant for finding the perfect home. Melbourne is a vast city, with different suburbs varying in culture, lifestyle, schools, and transport options. Choosing the right location should depend on your preferred lifestyle and priorities. Different suburbs also have a different price range; some may be more expensive than others.
The Process of Buying a House in Melbourne
If you’re new to buying a house in Melbourne, it’s good to understand the process. Melbourne’s real estate properties are sold through private treaty or auction process, and it’s essential to research thoroughly before making an offer. Your efforts should include checking the property’s condition, considering the location, price, and comparing similar properties in the area.
Working with a Real Estate Agent
Working with a real estate agent is essential in buying a property in Melbourne. They can assist in searching for your preferred type of property, recommend suitable suburbs, and help with the legal documents in finalizing the transaction. This relationship between buyer and agent is a vital part of a successful purchase, and establishing trust is key.
How Do I Finance My Property?
There are various ways to finance your property in Melbourne. One popular option is through a mortgage, and it’s crucial to have a stable income to qualify. Another option is self-funding, where you can use your savings to purchase your dream home.
Conclusion
In conclusion, Melbourne’s real estate market continues to be a dominant player in the industry. With the perfect combination of a booming economy, a high quality of life, low-interest rates, and auction sales strategy, the market has seen a significant increase in property prices. Melbourne’s real estate market is an attractive investment for both foreign and local buyers. If you’re new to the industry, it’s essential to understand the process, work with a reliable real estate agent and find the perfect location. Melbourne’s real estate market is vast, and with the proper knowledge and guidance, you can undoubtedly find your dream home in this city.
FAQs:
What is the Guide to Buying a House in Melbourne?
The Guide to Buying a House in Melbourne is a comprehensive guide that provides an overview of purchasing a property in Melbourne. It includes information about Melbourne’s property market, tips on finding the right location and property, the buying process, and financing your purchase.
Is it better to buy a house or an apartment in Melbourne?
The choice between buying a house or an apartment depends on your preferences and lifestyle. Apartments are generally less expensive than houses and are perfect for those who prefer low maintenance living. Meanwhile, houses provide more space and privacy, making them ideal for families or those who prefer more space.
How much money do I need to purchase a house in Melbourne?
The amount of money you need to purchase a house in Melbourne depends on the property’s location, size, and condition. On average, a homebuyer needs at least a 20% deposit to secure a loan. In addition to the deposit, there are other costs, such as legal fees and stamp duty, that you need to consider when purchasing a property.
How long does it take to buy a house in Melbourne?
The time to purchase a house in Melbourne varies, depending on the property and the buyer’s situation. The process can take weeks or months, from finding the perfect home to completing the legal documentation. Working with a reliable real estate agent can help hasten the process and ensure a smooth transaction.
Should I hire a buyer’s agent when purchasing a property in Melbourne?
Yes, hiring a buyer’s agent when purchasing a property in Melbourne is beneficial. They can assist in the research aspect of finding the right property, provide you with valuable insights and help strategize your bidding tactics at auctions. They can also save you money and provide you with peace of mind throughout the buying process.
What is the stamp duty rate in Melbourne?
The stamp duty rate in Melbourne depends on the property’s value and whether it’s for residential or commercial use. As of July 1, 2021, the stamp duty rate for residential properties costing $1 million or less is 2.5%. Meanwhile, properties with a value of more than $1 million have a stamp duty of 5.5%.
What are off-the-plan properties?
Off-the-plan properties are properties sold before they have been constructed. Buyers purchase the property based on the property’s blueprint, and the completion date can range from months to years. These properties are an attractive investment, particularly for first-time homeowners, as they offer potential for capital growth over time.
What are some things to consider when buying an investment property in Melbourne?
When purchasing an investment property in Melbourne, some things to consider include the property’s location, potential capital growth, rental yields, and any ongoing fees, such as maintenance or strata fees. It’s crucial to research the property’s potential income and expenses carefully, as well as the risks associated with owning an investment property.
Can non-residents buy property in Melbourne?
Yes, non-residents can buy property in Melbourne. However, there are specific guidelines that non-residents must follow when buying a property, such as getting approval from the Foreign Investment Review Board (FIRB). Non-residents must also pay a surcharge duty when purchasing a property in Victoria, which ranges from 7% to 8% of the property’s value, depending on the list price.
