MELBOURNE’S median house price has burst past $800,000 for the first time, off the back of its strongest quarterly growth since 2013.
It reached a record $826,000 after shooting up 7.6 per cent in the first three months of 2017, according to the Real Estate Institute of Victoria.
REIV president Joseph Walton said the substantial rise had been driven by a “perfect storm” of buyer demand, population growth, record low interest rates and a shortage of available housing.
“Competition for homes has encouraged more vendors to take their home to market, with multiple auction records falling this year,” he said.
“The city’s buoyant auction market, combined with the strongest private sale market in seven years, has undoubtedly boosted Melbourne’s median house price.”
REIV figures show almost 80 per cent of Melbourne auctions have resulted in sales this year.
Properties are also selling in a median of 29 days — the shortest time frame since May 2010 — showing the strength of the city’s private sale market.
Templestowe, 16km northeast of the CBD, experienced the biggest quarterly median house price gain of all Melbourne suburbs, rising 17.6 per cent to $1.552 million.
Four outer ring suburbs came next — Mount Eliza, where the median house price jumped 15.5 per cent to $1.27 million, Cranbourne North, up 14.9 per cent to $518,000, Kilsyth, up 14.7 per cent to $699,950, and Mornington, up 14.5 per cent to $870,000. Brunswick, Bundoora, Northcote, Cranbourne and Camberwell rounded out the top 10.
Harcourts Cranbourne director Andrew Cassimaty said houses in Cranbourne North were selling “after the first open for inspection, or even before it”, such was the buyer demand.
“The suburb still represents very good value,” he said.
New parents Megan Page and Haydn Ing — who bought a house in Seaford last month and sold their Chelsea unit soon after — and say they’re relieved to be in the skyrocketing market.
“If I hadn’t saved since high school and bought that unit, we wouldn’t have been able to buy this house,” Ms Page, 32, said.
“It’s scary to think, for people who haven’t done that, how they’re ever going to buy a house.”
The couple’s selling agent, Hocking Stuart Chelsea director Daniel Wright, said price growth in his patch of Melbourne “all came down to supply and demand.”
“There’s not a lot of property available,” he said.
“I’m hearing over and over again (from buyers): ‘We’ve been priced out of the market up the bay’.”
Cohen Handler associate Scott Hall said house auctions across Melbourne were regularly attracting at least four bidders and achieving “insane” prices — for example, an Albert Park terrace on just 147sq m of land at 97 Page St fetched $3.01 million last month.
He expected Melbourne’s median price growth to continue throughout the year, but “come off a bit”: “I don’t think we’ll hit $1 million this year,” he said.
Mr Walton said: “We’re not seeing any slowing in Melbourne’s property market, with demand continuing to outstrip supply.”
The city’s apartment market also enjoyed strong median price gains in the March quarter, rising 3.8 per cent to $583,000.