Is Melbourne Investment Property a Good Idea at the Moment?
There are many things an investor must take into consideration before going ahead with an investment property. A Lime Property Consultation will highlight all issues to every client before any decisions are made.
There are some factors which just make so much common sense but for some reason some people don’t think about them before investing.
Without going into another boring discussing on the old location, location, location adage, the key factors to research in any area must be:
- Scarcity and yield (supply and demand)
- Economic growth
- Job growth
- Population growth
- Affordability
Again, if you accept there is some sense in these criteria it seems pretty obvious why Australia’s leading researcher and forecaster, BIS Shrapnel, is suggesting that prices will drop in Victoria before the end of this year.
There seems to be plenty of stock in Melbourne but as the workshop of Australia, (it seems almost anything we still make should have “Made in Victoria” stuck on it rather than” Made in Australia”, the state economy cannot avoid taking a big hit as the major employers in Holden, Ford, Toyota and all the associated parts manufacturers start to close down towards the end of this year.
Melbourne is also suffering more from moving from a manufacturing-based economy in other ways which have also been evidenced to a lesser degree in Sydney and our other larger cities. As the cities push their boundaries further and further out, the job market is pushing in to the central CBD area leading to this recent headline in our daily media:-
Future fears: Melbourne young people won’t have access to jobs by 2031
The article goes on to say that “more than 90 per cent of the city’s jobs will be out of reach for much of Melbourne’s youth in 15 years.
Buying a house on Melbourne’s fringe or even in the city’s established outer suburbs won’t be practical for young people in coming decades, as jobs continue to become highly concentrated in the CBD.”
From our view point, investment in Melbourne is not looking very lucrative in the immediate future.
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