Where can you still find affordable housing in Melbourne?

Currently, Melbourne’s median house price was $610,000 based on sales in the December quarter. Naturally, this captures a lot of attention, however, it’s worth remembering that there are lot of houses that sell for a lot more affordable prices.

Over the past year, just under 30% of all houses in Melbourne sold for less than $400,000.

The suburbs which recorded the highest of these affordable sales were in the growth areas; Pakenham, Frankston, Craigieburn, Hoppers Crossing, Werribee, Sunbury and Carrum Downs. Land is less valuable in these areas due to the distance from the CBD and its availability. These factors allow developers to bring houses onto the market at more affordable prices.

It is interesting to note that there are a number of suburbs within 15 kilometre radius of the CBD where more than 50% of sales were below $400,000. These are: Sunshine West, Sunshine North, Broadmeadows, Ardeer and Tullamarine.

Glenroy, Reservoir, Fawkner and Sunshine also has reasonable proportions of sales for under $400,000.

Surprisingly, around one in 10 sales in Pascoe Vale, Box Hill and Footscray are under $400,000.  While that may not be the predominate sales price, this result does show that with some dedicated house hunting it is possible to buy a house at an affordable price within 15 kilometres of the CBD.

It would be rare to find a house under $400,000 and within 10 kilometres radius of the CBD. Footscray has the highest at 10%. Most other suburbs within 10 kilometres of the CBD have less than 5% such as Coburg where there were only 12 sales were under $400,000.

Robert Larocca is Victorian housing market specialist for RP Data.