Australian Property News
Melbourne and Perth top property hit list
Posted on Friday, February 19 2010 at 4:30 PM
Melbourne and Perth provide the most compelling property investment prospects in 2010, a Wakelin Property Advisory report says.
Discrepancies in capital growth performance between the major markets would continue in 2010, along with differences in the way various property types performed, the Outlook for residential property market report says.
"Melbourne led the major city price performance in 2009 and we believe it has the most compelling prospects for 2010," the report notes.
"It's Australia's second largest city, has one of the most diverse economic bases and the fastest growing population in numeric terms, yet the median house price still lags Sydney's by around $50,000 according to most measures."
"Market indicators such as high auction clearance rates and lowest average days on market point to continuing strong performance for Melbourne property."
Within the Melbourne metropolitan area, the Wakelin report suggests demand for period houses in the inner north will remain strong into the first half of next year, "driving up prices for houses in the arc extending from Moonee Ponds in the north west to Preston in the north east".
In Perth, confidence is oozing back into the market with the resurrection of the energy and resources sector, "driven by China's stockpiling of commodities and the announcement of the Gorgon LNG project", the report notes.
After Melbourne and Perth, Wakelin names Canberra, Brisbane and Sydney as the next most compelling investment locations.
"Rental markets remain drum-tight with vacancy rates at around 1.5 per cent in all major cities except Perth, where the current vacancy rate is now tightening," the report adds.
"After growing at just two per cent in 2009, we expect rents in most of Australia's cities to return to their previous pattern, with growth of up to eight per cent to 10 per cent per year."
Wakelin says the most compelling asset types for 2010 are period-style two-bedroom houses, and one-bedroom and two-bedroom apartments in established low-rise complexes, all in the inner suburbs of Australia's major cities.
Around the major capital cities, the firm says the most compelling investment locations are:
Sydney – inner west, middle-ring western suburbs, and inner east.
Melbourne – inner north, inner and middle-ring east, and inner and middle-ring southeast.
Brisbane – inner suburbs with dedicated transport routes.
Perth – middle-ring beachside suburbs, and the inner south and west adjacent to the CBD.
Adelaide – within six kilometres from the CBD.
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