Middle to outer east Melbourne becoming unaffordable for sub-$500,000: HTW

The middle to outer eastern Melbourne suburbs are becoming unaffordable, according to Herron Todd White’s latest July report.

The property data firm says that there are some areas where $500,000 can get you a two bedroom apartment or unit.

“Within the middle to outer eastern suburbs, $500,000 will not enable purchase of a dwelling, however there are some areas where 2-bedroom units or apartments are affordable.

“In Boronia the median unit sale price in March 2017 was $496,944 (RP Data) which is expected to achieve a rental return of $333 per week reflecting a yield of approximately 3.48%.

“Similarly, the median unit sale price in Bayswater in March 2017 was $467,000 (RP Data) which is expected to achieve a rental return of $330 per week reflecting a yield of approximately 3.67%.

“If buyers desire to be closer to the Melbourne CBD, apartments provide a more affordable option in suburbs such as Mitcham, Forest Hill and Blackburn.

“For example, 410/394-398 Middleborough Road, Blackburn sold on 27 April 2017 for $492,000.

“It last sold in 2013 for $528,000.

“The apartment comprises 2-bedrooms, 2-bathrooms and two basement car parking spaces.

“If the market keeps firming, soon buyers with a budget of $500,000 might be priced out of the 2-bedroom unit or apartment market, however 1-bedroom apartments would still provide an alternative.

“Last year, 2-bedroom dwellings were under $500,000 in Boronia and Mooroolbark, however currently the median price for a 2-bedroom house in Boronia is $572,750 (realestate.com) and $526,000 in Mooroolbark (realestate.com), so buyers with a budget of $500,000 can no longer afford these properties.

“A three bedroom house at 17 Old Kent Street, Mooroolbark (below) has been listed for between $550,000 to $590,000.

“Built in 1975 it last sold in 2015 for $400,000, in 2009 for $313,000, 2007 for $334,000 and in 2002 for $229,000,” the report stated.