At Nyko, one of the most common questions we are asked is ‘what part of Melbourne is best to invest in?’ Of course it’s difficult to broadly state that one region is better than another for investment, it comes down to specific suburbs within areas and even pockets within suburbs when selecting a location for investment. If you are investing in a town house or apartment, the distance to amenities is extremely important. A 1km difference in the distance to the main amenities can have a huge effect on growth for that type of property within the same suburb.
When selecting a location for investment, looking at historical figures can help but you have to be forward thinking – what happened in the past doesn’t always tell us what will happen in the future. This is especially evident with the new planning guidelines set with the Stage Governments ‘Plan Melbourne’ which is being implemented to promote urbanisation within Melbourne and ensure our infrastructure can cater for the rapid increase in population we are experiencing, which was over 95,000 people last year!
This plan and the change in demography Melbourne is experiencing is a game changer. What it shows us is that the majority of Melbournians no longer desire the 4 bedroom house on a quarter acre block. This will then affect which areas and the property types within those areas will perform best, based on what Melbournians will demand the most in the future.
Buying the house next door, and making 10%+ growth per annum, unfortunately won’t cut it in the decades to come. At Nyko, we believe that this growth is possible (Melbourne has an average growth of 9.53% per annum since 1966), but we will have to be a bit more calculated about finding the right places to invest in and at the right times.
Thanks for taking the time to read our latest blog, please comment below with your views and provide feedback on this blog or any other topics you would like us to cover in future pieces.
Bill Nikolouzakis – Nyko Property