Melbourne's Property Market Set to Surge: Record Prices in Sight

Melbourne's property market is experiencing a significant resurgence, with house and unit values climbing at some of the fastest rates in recent years. According to PropTrack figures, house prices in Melbourne have been gaining a nation-leading $250 per day in May. This surge has added almost $8000 (0.87 percent) to the city's typical house value, bringing it to $902,000 across the past 31 days.

Senior economist Eleanor Creagh noted that this past month marked Melbourne's biggest single month of growth for house prices since 2021. She predicts that if the current trajectory continues, with a 1.6 percent increase per quarter, the city could see a 6.7 percent resurgence over the next 12 months. This growth could potentially push Melbourne's median house price back to record levels of over $960,000 by Christmas.

While Melbourne has underperformed compared to other housing markets in the past five years, it is now becoming one of the more affordable capital cities. With interest rates potentially falling, renewed competition, and improving buyer sentiment, the city is poised to reverse its previous weakness. Real Estate Buyers' Agents Association of Australia Victorian representative Matthew Scafidi believes that the market has shifted in favor of vendors, with increased competition at auctions and more homebuyers attending inspections. He advises owners planning to sell to buy first, as the market is likely to provide a boost.

In addition to houses, Melbourne's median unit price also saw growth in May, rising almost $2000 (0.31 percent) to $588,000. Regional Victoria also experienced growth, with the median house price rising 0.18 percent to $602,000 and the typical unit costing $414,000 after a 0.17 percent increase in May. Areas around the Hume region, Bendigo, and Warrnambool and surrounds saw more significant increases.