{"id":7801,"date":"2016-05-01T01:00:02","date_gmt":"2016-04-30T15:00:02","guid":{"rendered":"http:\/\/realestatetalk.com.au\/?p=7801"},"modified":"2016-05-01T01:00:02","modified_gmt":"2016-04-30T15:00:02","slug":"is-melbourne-the-top-aussie-market","status":"publish","type":"post","link":"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/","title":{"rendered":"Is Melbourne the top Aussie market?"},"content":{"rendered":"

 
\nAs you will hear today, there is no one property market in Australia and that is being highlighted as we continue to look at the various markets that make up the country.\u00a0 That in fact is the first point Michael Yardney<\/strong><\/a> makes when we ask him about Victoria.\u00a0 Interesting to note that while we all talk about the big gains out of Sydney, you might be surprised to hear what Michael says about the performance of the Melbourne market.
\nTranscript:<\/strong>
\nKevin:<\/b>\u00a0 First up on the show, let\u2019s have a look at one of the bigger markets around Australia. Sydney and Melbourne, of course, have been recognized as the two big winners going forward, and we\u2019ll have a look at the Victorian market now. Joining me to have an overview of that, Michael Yardney<\/a> from Metropole Property Strategists.<\/a>
\nMichael, I know you work all over Australia, but for the sake of this chat, can we talk purely about the Victorian market?
\nMichael:<\/b>\u00a0 Of course, we can, Kevin.
\nKevin:<\/b>\u00a0 What is your overview of Victoria, and how the property market is faring there?
\nMichael:<\/b>\u00a0 Let\u2019s be clear. There is not one Victorian property market<\/a>. When people talk about Victoria, they generally mean Melbourne. Even within the Melbourne property market<\/a>, it\u2019s very fragmented. But Melbourne has won the two-horse race between Sydney and Melbourne over the last couple of years with now last year, the last 12 months, having a 9.8% overall capital growth, which means certain areas have done particularly nicely and others haven\u2019t as strong.
\nLooking even over the last ten years, the average dwelling price has changed 6.9% in Melbourne, which is the highest growth over the last decade compared to Sydney, which only grew at 5.9%, Darwin 5.6%, and the overall state capitals at 5.4%, so Melbourne has been the clear winner.
\nKevin:<\/b>\u00a0 What\u2019s impacting the market there right now, both positively and negatively?
\nMichael:<\/b>\u00a0 The big thing that has impacted the Melbourne property market <\/a>that has kept it growing is our economy and jobs creation. Kevin, we didn\u2019t have the ups and downs of the other states, so we didn\u2019t get the mining boom and mining bust mentality. What we did do was slowly but surely, change from a manufacturing state to a services industry state with finance, health, and IT jobs, which were good-paying jobs.
\nPeople came for the jobs. Wages growth in the service industries allowed people to be able to spend more, they had high disposable income, and they wanted to live in the city, and more of them are coming here, so strong population growth and strong jobs growth pushing up values. Then it led investors to hop onto the bandwagon of capital growth, as well, so it was a multitude of factors.
\nKevin:<\/b>\u00a0 How would you describe investor sentiment in that area now, Michael?
\nMichael:<\/b>\u00a0 Interestingly, at our offices at Metropole, we\u2019re seeing more investors wanting to invest in Melbourne than we have for a long, long time. At the end of last year, they were a little bit cautious, a bit nervous with the scares about APRA. Earlier this year, there were some concerns about negative gearing. I think they\u2019re recognizing that we are not going to grow as well in the next couple of years as we did the last couple of years, but still, there is good certain long-term growth if you buy the right property \u2013 strong investor sentiment, Kevin.
\nKevin:<\/b>\u00a0 What are the areas that you\u2019d avoid, and why?
\nMichael:<\/b>\u00a0 The big areas to avoid are the inner city and off-the-plan property markets. We\u2019re building too many. Over the last few years, we\u2019ve built three times the average number of properties we\u2019ve built in the past, and it\u2019s been fueled by investors speculating \u2013 not really investing \u2013 hoping that property values would go up, and therefore, buying off-the-plan and overseas investors.
\nBut now there is about 14% of all of the properties of the CBD sitting vacant, a very significant proportion of all of the properties being underpinned by investors, not owner-occupiers, and they\u2019re sometimes a bit fickle. Values are dropping. Rents are not going up. There will be maybe a decade when there will be no capital growth or rental growth. I\u2019d be avoiding those areas.
\nThe other areas I\u2019d avoid are the newer states. We\u2019re building a few too many houses for first-home buyers, and some investors are being lured to buy in these outer suburbs. They won\u2019t get capital growth there, either.
\nKevin:<\/b>\u00a0 Going back on something you just said, that figure you said about the number of apartments that are sitting vacant, what was that number again?
\nMichael:<\/b>\u00a0 According to BIS Shrapnel, 14% of properties in Melbourne\u2019s CBD are sitting vacant, and most of those are not on the rental pool. In other words, the rental vacancy rate is only 3.5%. It\u2019s just overseas investors have locked them up, not turned on the lights or electricity, and are leaving it there \u2013 land-banking, so to speak.
\nKevin:<\/b>\u00a0 Wow. That\u2019s a major concern.
\nMichael:<\/b>\u00a0 It could be, but remember, their motives are different to yours and mine as investors. What they\u2019re doing is just putting their money somewhere secure. I believe their mentality is \u201cThis is a new apartment.\u201d They like the concept of new. Keeping it new and pristine, in their mind, adds value, keeps its value. I\u2019m not sure that\u2019s true, though.
\nKevin:<\/b>\u00a0 Yes, it\u2019s going to skew the vacancy figures, because we\u2019re looking at a balanced market being around 6%, but if you put that pool in there, you\u2019d go well above 6%, wouldn\u2019t you?
\nMichael:<\/b>\u00a0 Sure, but they\u2019re actually not in the letting pool. They\u2019re just lock and leave. People are leaving them alone.
\nHaving said that, the vacancy rate in the CBD and inner-city areas is high. In general, in Melbourne, the vacancy rate has been comfortable. What we\u2019re noticing is there are lots more people turning up to open for inspections.
\nRent growth has been very poor, but with the current vacancy rate according to SQM Research at around 2%, it\u2019s actually suggesting that we\u2019re going to lead into a period of higher rental growth as there are more people starting to look for properties and not as many around. But that\u2019s overall in Melbourne; there are some pockets, as I\u2019ve already said, that I\u2019d definitely be steering clear of because the vacancy rates are much too high.
\nKevin:<\/b>\u00a0 Looking ahead \u2013 and I want a very quick answer, if I may \u2013 without notice, rate out of ten, ten being the highest, one being the lowest, how would you rate Melbourne\u2019s future growth potential?
\nMichael:<\/b>\u00a0 In 2016, it\u2019s going to be number one in that it will be the fastest growing capital city market with an overall capital growth probably in the order of 5%, maybe even 6%. It\u2019s not staggering, but it\u2019s definitely going to end the year better than it started.
\nKevin:<\/b>\u00a0 Always good talking to you, Michael Yardney<\/a> from Metropole Property Strategists<\/a>. There\u2019s your outlook for the Victorian market.
\nThanks, Michael.
\nMichael:<\/b>\u00a0 My pleasure, Kevin.
\n <\/p>\n","protected":false},"excerpt":{"rendered":"

  As you will hear today, there is no one property market in Australia and that is being highlighted as we continue to look at the various markets that make up the country.\u00a0 That in fact is the first point Michael Yardney makes when we…<\/p>\n","protected":false},"author":176692471,"featured_media":7802,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[32,10,11,13,22,27],"tags":[103],"class_list":["post-7801","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-buying-a-property-topic","category-kevin-turner-sponsored-channels","category-kevin-update","category-latest-story","category-research-topic","category-trends-topic","tag-podcasts"],"yoast_head":"\nIs Melbourne the top Aussie market? - Realty Talk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Is Melbourne the top Aussie market? - Realty Talk\" \/>\n<meta property=\"og:description\" content=\"  As you will hear today, there is no one property market in Australia and that is being highlighted as we continue to look at the various markets that make up the country.\u00a0 That in fact is the first point Michael Yardney makes when we...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/\" \/>\n<meta property=\"og:site_name\" content=\"Realty Talk\" \/>\n<meta property=\"article:published_time\" content=\"2016-04-30T15:00:02+00:00\" \/>\n<meta name=\"author\" content=\"rolanrush\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"rolanrush\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"6 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/is-melbourne-the-top-aussie-market\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/is-melbourne-the-top-aussie-market\\\/\"},\"author\":{\"name\":\"rolanrush\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#\\\/schema\\\/person\\\/384a57ac9e52cb9bf19896cb15eaa52d\"},\"headline\":\"Is Melbourne the top Aussie market?\",\"datePublished\":\"2016-04-30T15:00:02+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/is-melbourne-the-top-aussie-market\\\/\"},\"wordCount\":1211,\"commentCount\":0,\"image\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/is-melbourne-the-top-aussie-market\\\/#primaryimage\"},\"thumbnailUrl\":\"\",\"keywords\":[\"podcasts\"],\"articleSection\":[\"Buying a property\",\"Kevin Turner\",\"Kevin's Update\",\"Latest Stories\",\"Research\",\"Trends\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/is-melbourne-the-top-aussie-market\\\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/is-melbourne-the-top-aussie-market\\\/\",\"url\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/is-melbourne-the-top-aussie-market\\\/\",\"name\":\"Is Melbourne the top Aussie market? - Realty Talk\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/is-melbourne-the-top-aussie-market\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/is-melbourne-the-top-aussie-market\\\/#primaryimage\"},\"thumbnailUrl\":\"\",\"datePublished\":\"2016-04-30T15:00:02+00:00\",\"author\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#\\\/schema\\\/person\\\/384a57ac9e52cb9bf19896cb15eaa52d\"},\"breadcrumb\":{\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/is-melbourne-the-top-aussie-market\\\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/is-melbourne-the-top-aussie-market\\\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/is-melbourne-the-top-aussie-market\\\/#primaryimage\",\"url\":\"\",\"contentUrl\":\"\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/is-melbourne-the-top-aussie-market\\\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Is Melbourne the top Aussie market?\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#website\",\"url\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/\",\"name\":\"Realty Talk\",\"description\":\"Your Trusted Voice For Property Investing. Anywhere, Anytime.\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/#\\\/schema\\\/person\\\/384a57ac9e52cb9bf19896cb15eaa52d\",\"name\":\"rolanrush\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/86544778804295a7fa45cbde097dc3a58a45ba6ed28859f17059ca74c38723d2?s=96&d=mm&r=g\",\"url\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/86544778804295a7fa45cbde097dc3a58a45ba6ed28859f17059ca74c38723d2?s=96&d=mm&r=g\",\"contentUrl\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/86544778804295a7fa45cbde097dc3a58a45ba6ed28859f17059ca74c38723d2?s=96&d=mm&r=g\",\"caption\":\"rolanrush\"},\"url\":\"https:\\\/\\\/channels.realty.com.au\\\/realtytalk\\\/author\\\/rolanrush\\\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Is Melbourne the top Aussie market? - Realty Talk","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/","og_locale":"en_US","og_type":"article","og_title":"Is Melbourne the top Aussie market? - Realty Talk","og_description":"  As you will hear today, there is no one property market in Australia and that is being highlighted as we continue to look at the various markets that make up the country.\u00a0 That in fact is the first point Michael Yardney makes when we...","og_url":"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/","og_site_name":"Realty Talk","article_published_time":"2016-04-30T15:00:02+00:00","author":"rolanrush","twitter_card":"summary_large_image","twitter_misc":{"Written by":"rolanrush","Est. reading time":"6 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/#article","isPartOf":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/"},"author":{"name":"rolanrush","@id":"https:\/\/channels.realty.com.au\/realtytalk\/#\/schema\/person\/384a57ac9e52cb9bf19896cb15eaa52d"},"headline":"Is Melbourne the top Aussie market?","datePublished":"2016-04-30T15:00:02+00:00","mainEntityOfPage":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/"},"wordCount":1211,"commentCount":0,"image":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/#primaryimage"},"thumbnailUrl":"","keywords":["podcasts"],"articleSection":["Buying a property","Kevin Turner","Kevin's Update","Latest Stories","Research","Trends"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/#respond"]}]},{"@type":"WebPage","@id":"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/","url":"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/","name":"Is Melbourne the top Aussie market? - Realty Talk","isPartOf":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/#website"},"primaryImageOfPage":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/#primaryimage"},"image":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/#primaryimage"},"thumbnailUrl":"","datePublished":"2016-04-30T15:00:02+00:00","author":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/#\/schema\/person\/384a57ac9e52cb9bf19896cb15eaa52d"},"breadcrumb":{"@id":"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/#primaryimage","url":"","contentUrl":""},{"@type":"BreadcrumbList","@id":"https:\/\/channels.realty.com.au\/realtytalk\/is-melbourne-the-top-aussie-market\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/channels.realty.com.au\/realtytalk\/"},{"@type":"ListItem","position":2,"name":"Is Melbourne the top Aussie market?"}]},{"@type":"WebSite","@id":"https:\/\/channels.realty.com.au\/realtytalk\/#website","url":"https:\/\/channels.realty.com.au\/realtytalk\/","name":"Realty Talk","description":"Your Trusted Voice For Property Investing. Anywhere, Anytime.","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/channels.realty.com.au\/realtytalk\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/channels.realty.com.au\/realtytalk\/#\/schema\/person\/384a57ac9e52cb9bf19896cb15eaa52d","name":"rolanrush","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/secure.gravatar.com\/avatar\/86544778804295a7fa45cbde097dc3a58a45ba6ed28859f17059ca74c38723d2?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/86544778804295a7fa45cbde097dc3a58a45ba6ed28859f17059ca74c38723d2?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/86544778804295a7fa45cbde097dc3a58a45ba6ed28859f17059ca74c38723d2?s=96&d=mm&r=g","caption":"rolanrush"},"url":"https:\/\/channels.realty.com.au\/realtytalk\/author\/rolanrush\/"}]}},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/posts\/7801","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/users\/176692471"}],"replies":[{"embeddable":true,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/comments?post=7801"}],"version-history":[{"count":0,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/posts\/7801\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/media?parent=7801"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/categories?post=7801"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/channels.realty.com.au\/realtytalk\/wp-json\/wp\/v2\/tags?post=7801"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}