REIV market report shows regional house prices are growing, despite Melbourne's dropping

According to the Real Estate Institute of Victoria's (REIV) December Quarterly Median Report, regional Victorian house prices grew eight per cent over the year to $610,000, while the annual median price for units and apartments grew 6.5 per cent to $425,000.

Kyneton showed some of the top growth out of all regional Victorian suburbs, adding $100,000 to its median house price of $1,040,000, while Grampians town Stawell saw its median price grow by 8.7 per cent this quarter and 21 per cent annually to $375,000.

Bendigo's median sale price increased 2.2 per cent in the last quarter to $690,000. It's an increase of $55,000 from the same quarter in 2021.

In the growing suburb of Huntly, the median house price dropped by 2.5 per cent last quarter to $585,000, however prices are up $50,000 from this time last year and up $147,000 from the start of 2021.

Outer suburb Maiden Gully saw a price rise of 1.3 per cent to $775,000, with house prices rising by $132,000 since the start of 2021.

The median rent for regional Victoria is $420. In Bendigo, it's $380, while Huntly and Maiden Gully have median rents of $450 and $508 respectively.

Houses, on average, spend 52 days on the market across all of regional Victoria, however that number drops to 43 in Bendigo, 30 in Huntly, and 36 in Maiden Gully.

The annual median house price in metropolitan Melbourne has dropped by 3.3 per cent, although it remains above the million-dollar mark.

The quarterly median house price dropped 1.6 per cent to $974,000 while units and apartments dropped 2.6 per cent to $627,000.

Prices in outer Melbourne suburbs grew 1.8 per cent to $830,000 over the past year, with the western suburbs recording "outstanding growth" and showing "great investment potential for homebuyers", according to REIV.

REIV president Andrew Meehan said the data shows "good buying opportunities" and a resilient real estate market across the state.

"The drop we've seen in the median prices in metro Melbourne must be seen in the context of the rapid price growth Victoria has recorded over the past two years," he said.

"Property prices still remain higher than they were in December 2020 - the post-COVID real estate boom has placed Victorian property in a stronger position than ever before, a trend we continue to see across numerous suburbs in metro Melbourne and our regional areas".

"Now, as we enter the new year and the immigration levels return, we will no doubt see continuous demand in the market as Melbourne's population grows and investors see strong potential for growth in our state".

According to online home loan lender Well Money, formerly known as Well Home Loans, Marong tops the state in terms of investment-grade suburbs where buyers have a negotiating edge over vendors.

Data compiled from Suburbtrends shows the growing suburb in Greater Bendigo's west had a 10-year price gain of $442,000, a net gain of 127 per cent.

The median asking price in December 2022 was $574,340 and it recorded an inventory level of 3.8 months.

A lower inventory level indicates houses are being bought quicker than they are being put on the market.

Marong recorded a vacancy rate of 0.0 per cent, which means rental vacancies were filled in less than 21 days.

Seventh of Well Money's list of top 20 Victorian suburbs for investors is Woodend, with a median asking price of $892,000, a net gain of 127 per cent over the past decade.

Its inventory level is 4.9 months and vacancy rate is 1.3 per cent.

Well Money CEO Scott Spencer said market conditions have been turning in buyers' favour as "demand relative to supply has been falling".

Suburbs on the top 20 list "have low inventory levels, which will put upward pressure on price growth, and low vacancy rates, which will put upward pressure on rental growth," Mr Spencer said.

"So the data suggests that investors would be more likely than not to enjoy positive returns."

However, Mr Spencer said people looking to invest should remain vigilant of interest rates.

"Interest rates have been rising and will probably increase even further in the first half of 2023, so investors need to budget for higher repayments," he said.

"It's risky to enter the market if you don't believe you'd have the capacity to cope with higher interest rates."

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