Melbourne Property Strong for Investors
Investors searching for real estate in Melbourne may be wise to consider apartments in the city, as new information has shown this type of dwelling is posting strong results.
Data recently released by the Real Estate Institute of Victoria (REIV) has shown that when compared to the December quarter in 2013, the weekly median rent for two-bedroom apartments surpassed that of three-bedroom houses.
Over the first quarter of 2014, weekly median rents for two-bedroom apartments increased by 1.3 per cent to reach $390, while three-bedroom houses reached $370 per week.
On top of this, one-bedroom apartments in Melbourne increased by 2.7 per cent since the December quarter last year to bring median weekly rents up for $340.
Commenting on the release of the statistics, REIV Chief Executive Enzo Raimondo said it's the fast rise in new apartment buildings being constructed in the city that has helped to make this housing choice an attractive option for both renters and home buyers.
"These apartments continue to attract good rents. It appears that this 'state-of-the-art' style of living is appealing to, and drawing tenants across Melbourne," said Mr Raimondo in an April 16 statement.
Melbourne yields growing
The REIV information comes on the heels of a report from Australian Property Monitors (APM), which detailed how the rental market fared over the March quarter of 2014.
In Melbourne, investors of units saw a 5.6 per cent increase in gross rental yields over the quarter. Currently, the rental yield for units in Melbourne is sitting at 4.86 per cent. This was the largest increase in rental yields for units in the country, demonstrating the strength of this market for investors.
The APM report also showed that Melbourne property rents are continuing to rise. Unit rents recorded a 4.3 per cent increase over the March quarter, while houses saw a boost of 1.3 per cent.
Strong population growth in Melbourne
Investing in the inner suburbs of Melbourne will be a strong choice for investors, as these are areas that see a high rate of high-density development. As more houses enter the market, it will help the city prepare itself for expected population growth in the future.
Already, inner Melbourne has seen its population rise significantly in recent years. Figures from the Australian Bureau of Statistics found over the 12 months to 2013, inner Melbourne's population rose by 3.9 per cent to reach 568,400 people. Much of this activity was centered in Docklands, Southbank and Abbotsford.