Andrew Wilson August 25, 2012
Apartments in South Yarra. Photo: Rebecca Hallas
An emerging oversupply of new apartment stock and lack of investor interest has seen Melbourne’s unit market weaken for the third consecutive quarter with the median unit price slumping 1.2per cent in the three months to the end of June.
The June quarter median unit price of $392,862 is 1.7per cent lower than it was at the start of 2012 and 4.8per cent lower than the peak of $412,469 recorded over the December quarter 2009.
Some of Melbourne’s most popular inner-city suburban apartment markets are among those that saw declines — St Kilda’s median unit price is down by 4.7 per cent, Docklands has dropped 1.3 per cent and Southbank is down by 1 per cent.
But a handful of popular inner-city unit suburbs have bucked the trend including South Yarra, where the median unit price rose by 6.9per cent, and central Melbourne, where it was up 3.1 per cent.
Overall weakness in the Melbourne apartment market is set to continue as more new apartments are released and residential investor activity in Victoria declines. In an indication of this, Bureau of Statistics data shows investor loan value in the first six months of this year was 3.3per cent below that of the same period in 2011.
Dr Andrew Wilson is senior economist for Australian Property Monitors, a Fairfax-owned subsidiary. Twitter: @DocAndrewWilson