Big price slump for ritzy Melbourne suburbs

Apr 4 2011 / 8:16 am Was written by Atwell & Co. Comments Off

Melbourne’s wealthy inner suburbs dropped the most in value in the September quarter last year as the state’s overall prices for houses and units declined 2 per cent, the latest snapshot from the Valuer-General shows. Some of the biggest falls came in upmarket suburbs such South Yarra, Hawthorn and Toorak. Williams Landing, the suburb adjoining to Laverton in Melbourne’s west, bucked the decline to be the star performer in the quarter, with homes in the area increasing in value by 47.3 per cent. Advertisement: Story continues below Median home values in Williams Landing jumped from $379,000 to $558,100 over the three months to September. At the other end of the scale, South Yarra saw median house prices drop by 28.8 per cent from $1,370,000 to $975,000, the biggest decrease in the state. The Valuer-General’s data is derived from compulsory sale notices and is therefore considered to be the most accurate property price information available. Still, with some real estate transactions taking as long as 90 days to settle, the corresponding length of time it takes to compile the data means it reflects trends in the property market more than five months ago. More recent data from other property analysts shows similar flat-lining or slight decreases in values in January and February this year. Property analyst Residex has Melbourne’s median house price decreasing to $598,000 by a marginal 0.19 per cent over the three months to February 2011. The decrease in values over the quarter follows high price growth over the full year to September 2010. House prices in Melbourne rose 16.1 per cent and units rose 10.1 per cent of the 12 month period. The price of vacant land increased by 14.1 per cent over the same time frame. Hawthorn, Toorak retreat Hawthorn’s median price also dropped dramatically by 24.6 per cent from $1,602,500 to $1,208,000, the Valuer-General said. Toorak, which had the highest median price of $2,335,000, also suffered an 11.9 per cent decrease from the previous quarter and a 15.1 per cent decrease from the same period the year before. “It can generally be observed that with a few exceptions, the September 2010 quarter produced general decreases in the eastern suburbs and a mix of increases and decreases in the western suburbs,” the Valuer-General’s report said. House prices in metropolitan Melbourne dropped two per cent in the September quarter, from $500,000 to $490,000. This followed an increase of seven per cent in the previous quarter. The September results also showed a dip in sales volumes, the lowest quarterly result since the March 2009 quarter. The Real Estate Institute of Victoria will release its March 2011 quarter results in two weeks’ time. “We wouldn’t be surprised if this quarter saw a reduction of 3 to 5 per cent,” spokesman Robert Larocca said. The drop in values was likely to reflect a quieter month in January and no seasonal adjustment to the figures, he said.

By Simon Johanson

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