Melbourne real estate is ripe for investment: Freedom Property Investors
EXPERT INSIGHT
With the stamp duty waiver for purchases of Victorian residential property set to end on 30 June, the next fortnight may prove fruitful for investors considering their next purchase.
The Australian property market is continuing to grow at an unprecedented rate, with the latest data from CoreLogic showing national home values rising another 2.2% in May.
However, not every suburb in every city across the country will experience growth.
The question then, particularly for those looking to grow their property portfolios, is when do I buy, and where?
When do I buy?
Last November, the State Revenue Office Victoria initiated a land transfer duty waiver for purchases of Victorian residential property with a dutiable value of up to $1 million, and on 30 June, this incentive will end.
The waiver reduces stamp duty by as much as 50% for new residential properties - 25% for existing residential properties and vacant residential land. In other words, property investors stand to save up to $15,000 - and this is after other eligible benefits, such as the principal place of residence, and pensioner concessions, have been applied.
With some easing in the impact of government incentives, and Victoria being the only state with any such concessions available to investors, for Australians looking to diversify their property portfolios at a discount, the time to buy is now.
Ovation Footscray
Where do I buy?
Savvy investors purchase properties in locations where developers are out of sync with market demand.
In the face of significant and unpredictable lockdown measures, common sense might dictate that now is not the time to invest in Melbourne. After all, it fell six places in the 2021 Economist Intelligence Unit’s Global Liveability Index, and according to a report by the Centre for Population, published in December, interstate migration out of Victoria is expected to grow as residents seek greater stability.
However, a strong investment is one built on strong data, and this data does not paint a complete picture.
There are select suburbs, even streets, in Melbourne where growth could be substantially greater than others.
Among these regions is Geelong. Unlike most other regional cities, Geelong is relatively close to a major capital city, being only a 90-minute drive to the Melbourne CBD.
The planned Geelong Fast Rail will not only boost Geelong’s transport infrastructure, but shorten the travel time into Melbourne, encouraging even greater numbers of city workers to take up residence in the region. In fact, the City of Greater Geelong is one of the fastest growing regions in Australia, with its population of 250,000 expected to swell to 350,000 by 2041.
Its unemployment rate (4.3%) is well below the national average (6.7%), and in the last five years alone, median house prices have risen over 46%.
Scott Kuru and Lianna Pan are Co-Founders of Freedom Property Investors