New Data represents rise in the Entry prices for First Home Buyers across Melbourne
Getting harder for First Home buyers to break through at the bottom end of the market than it was in this time last year. Even though the prices are slipping off from the peak.
The state government last July introduced new incentives for first-home buyers that mean no stamp duty is paid on properties purchased at or under $600,000.
At that time, there were 104 suburbs in Greater Melbourne where one in four homes sold for less than $600,000, according to a Domain Group analysis that only included suburbs with 100 or more annual sales.
A year on and that list of suburbs has shrunk to 68. Among the dozens of suburbs that have fallen off the list: Reservoir, Sunshine, Keysborough and Boronia.
While market commentary usually revolves around a “median price” — the middle sale price of all homes sold — data showing a suburb’s bottom quarter of sales can make entry-level price trends clearer.
The data shows prospective city buyers looking to pay less than $600,000 for a house have substantially fewer options than they did a year ago.
When the Andrews government announced stamp duty concessions for first-home buyers, economic experts warned that it could push up prices beyond the amount buyers were saving in stamp duty.
Once considered an affordable blue-chip neighbourhood, many buyers in Reservoir have found themselves priced out of the local property market.
Those looking for a house for less than $600,000 would now need to look further north to Thomastown or Lalor. Quality two-bedroom apartments in Reservoir were selling for upwards of $550,000 while brand new three-bedroom duplexes could fetch up to $900,000.
Treasury figures show first-home buyers have flocked to the city’s growth corridors, predominantly buying in Wyndham, Casey and Hume, since stamp-duty incentives were introduced.
Domain Group sales data indicates entry-level property prices have shot up in many of these areas, in some cases by as much as $100,000.
A year ago, Frankston’s entry-level house price was $430,000. It is now $535,000. Meanwhile, Werribee’s entry-level house price has risen from $351,000 to $430,000.