Moe beats Mildura as Victoria's top-performing regional city: Residex October quarter
The historic Gippsland town of Moe on the western end of the Latrobe Valley was Victoria’s top-performing housing market over the October quarter, according to new figures by Residex.
Moe house prices increased by 4.66% over the three months to October, rising to a median value of $243,500.
Residex calculates the median weekly rent in Moe at $270, suggesting investors can expect rental returns of around 5.7%.
Moe (along with Morwell and Traralgon) is one of the major urban centres in the Latrobe Valley, which has a population of around 18,000 people according to the 2011 census.
The majority (80%) of properties are houses, with around one in four (27%) Moe residents renting.
In its September market round-up valuers from Herron Todd White (HTW) picked Moe along with Morwell and Newborough as offering sub-$300,000 opportunities with 1980s and 1990s brick veneer homes.
HTW said also that 1970s units can be bought for well under $300,000 with gross rental returns of 7% to 9% possible.
Investment properties listed for sale include a four-bedroom weatherboard house priced between $185,000 and $200,000 and marketed by Alan Johnson and Ross Maddaluno of Ross Maddaluno Real Estate Morwell. It is expected to rent for $250 per week, an indicative yield in excess of 6%.
Current listings also include this modern two-bedroom townhouse, which has an asking price of $195,000 and rents for $240 per week, a gross yield of 6.4%.
The second best performing region in Victoria over the October quarter was the north-western regional city of Mildura in the Sunraysia region, with house prices up 3.2% to a median of $194,500.
With a median weekly rent of $235, Mildura investors can expect rental returns around 6.3%.
In its September assessment of sub-$300,000 options, HTW says investors should look at brick veneer houses in Mildura built between 1995 and 2006 on reasonably sized allotments in the centre.
"The home won't come with a pool and will have an average fit-out, but will most likely have some established landscaping and not need any immediate upgrading," HTW said.
HTW also suggested buying four-bedroom homes off the plan on the fringes of Mildura, which are popular with out of town investors, “keen to capitalise on the tight rental market and potential to obtain 6% gross rental returns combined with higher depreciation allowances than would be obtained from older dwellings”.
Currently listed for sale in Mildura is this three-bedroom weatherboard house built in 1940 priced between $115,000 and $145,000 marketed by Barry Plant Real Estate Mildura as an investment opportunity with rental potential of $220 per week. This would represent a yield of between 8% and 10% at this price range.
According to RP Data records, it rented for $170 per week in 2008.
The Victorian regional centres of Ballarat and Bendigo registered modest house price growth over the quarter of 1.72% ($277,500) and 1.09% ($266,500) respectively, while Geelong house prices fell 2.28% to a median of $380,000.
House prices in Warrnambool, often picked on hotspot lists, fell by 2.5% over the quarter to $269,000.
