Three-bedroom houses outperforming all other Melbourne property types: REIV

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Feb 5, 2018

Three-bedroom houses outperforming all other Melbourne property types: REIV

The increased proportion of owner occupiers in the market is driving greater demand for family homes, says the REIV.

Image: Aaron Huber on Unsplash.

Large family homes are highly sought after in Melbourne.
Supplied by REIV.

Richard Simpson, president, REIV.

The increased share of owner occupiers in the market has caused the prices of larger homes to rise across Melbourne, according to the latest data from the REIV.

New data shows three-bedroom houses outperformed all other property types in the December quarter, increasing 2.6 per cent to a citywide median price of $730,000.

Source: REIV.

REIV President Richard Simpson said three-bedroom family homes in the outer suburbs experienced the strongest price growth, rising 17.2 per cent over the quarter to a median of $587,000.

“Space is at a premium in Melbourne, which is encouraging more family buyers to consider established suburbs in the city’s outer ring,” he said.

“The bridesmaid effect is really driving buyers with families further from the city, with strong growth within 20km of the CBD pricing owner-occupiers out of these markets.”

“Changes to densification and height restrictions in the past year have increased demand from developers in the inner and middle rings, with larger homes and land blocks in these areas pinpointed for future development.”

“Traditional homes in outer Melbourne remain relatively affordable by comparison, with buyers able to purchase a home with a backyard for less than half the price of those in inner Melbourne.”

Melton and Melton South in the city’s west experienced some of the strongest quarterly price growth for this property type, up 17.8 and 14.7 per cent respectively. Despite the growth, the median price of a three-bedroom house in both suburbs remains under $400,000.

“Suburbs better known for their affordability were the city’s top performers for family homes, as buyers looked for new growth areas to enter the market.”

Simpson said four-bedroom homes also performed strongly during the December quarter, with the city-wide median price rising 2.5 per cent $851,000.

Source: REIV.

Hoppers Crossing in the south-west saw the largest increase for four-bedroom houses with the median price increasing 12.6 per cent to $595,000.

Meanwhile, citywide two-bedroom houses are the most expensive property type with a median price of $900,000.