Melbourne’s changing demographics affecting property market

Four inner-western and inner-northern Melbourne suburbs have offered the best investment value, according to the Annual Recommended Suburbs Survey of the Melbourne-based independent research advisory firm Nyko Property.

The suburbs, Footscray and Maidstone in the inner west and Thornbury and Preston in the inner north, are located within 10 kilometres of the CBD and were undervalued when sold in 2008/09 with a median unit price of under $400,000, in line with the Melbourne Unit Median of $377,000.

Nyko Property Director Bill Nikolouzakis says: “Their price and location gave these key suburbs substantial upside; we identified that they were poised for growth, even in a flat and falling market.

“Although Footscray and Thornbury had a lower socio-economic demographic, our research suggested their proximity to the CBD and the high performance of the neighbouring suburbs would ensure their gentrification,” he says.

Nikolouzakis says that Nyko’s Annual Recommended Suburbs Survey, which uses rigorous and impartial research to assess new property projects for their investment suitability, has stood the test of time.

“The suburbs we have selected in the Nyko surveys from 2008-13 have outperformed the Melbourne unit market by 2.77% per annum – a 63% improvement – as well as holding up well against the Australian unit market, outperforming it by 2.52% per annum – a 54% increase.

“For the clients that bought in Thornbury, their suburb outperformed the Melbourne market in that time by over 100%.

“Our survey takes into account the demographics of the suburb as well as the new demographic entering the area through gentrification and selected projects that we felt most suited that change.”

Nikolouzakis says that Plan Melbourne has been a key factor in identifying which locations are likely to see the highest spike in employment and population growth.

“The State Government has pinpointed suburbs, and even key areas within those suburbs, in which they anticipate growth and therefore have committed extra funds for improvement of infrastructure and amenities.

“An in-depth knowledge of the local areas and the micro-economic factors affecting them are the keys to selecting high growth locations.

“Historically, Australians have bought investment property driven by emotion rather than logic, buying in the area they live in, grew up in or locations that have a certain prestige; this is never the best investment option.”

Bill Nikolouzakis – Nyko Property

Bill Nikolouzakis (250px)

 

Media contact

Simrita Virk

Shed Media

+61 434 531 172

svirk@shedmedia.com.au

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