Melbourne property market impacted by overseas demand

The property market in Victoria's capital continues to be heavily influenced by international interest, says the Melbourne City Council's Property Watch report.

Released Tuesday (May 29), the annual update on the supply, demand, turnover, median prices, rents and vacancy rates of properties in the City of Melbourne’s municipality, Property Watch provides an inclusive analysis of the market.

It also provides data regarding the median price and rental for residential properties across Melbourne and it shows that an increase in supply due to high levels of construction and lower consumer confidence has been affecting prices.

Those considering buying property in the state capital may be encouraged by figures recently released by a joint effort between the Housing Industry Association and the Commonwealth Bank of Australia.

The HIA- Commonwealth Bank Housing Affordability Index shows that housing prices in the city have improved by 7.3 per cent in the March 2012 quarter.

Chair of the Future Melbourne (Economic Development and Knowledge City) Committee Kevin Louey was confident in the city's real estate market.

"The report confirms Melbourne's appeal as an investment destination across the board, which is only cemented by our status as one of the world's most liveable cities," Mr Louey said.