Melbourne Inner West / North - Winter 2024 Market Update

With a mix of growth and stabilisation, Inner West / North Melbourne’s recovery trend throughout the first quarter of 2024 presented a promising outlook for the residential property market. Auction clearance rates were relatively strong, reflecting healthy buyer interest. Properties spent a moderate amount of time on the market before being sold, indicating a balanced market with steady activity. The rental market was particularly strong, driven by significant immigration and increased demand for rental properties leading to low vacancy rates and higher rental yields. While turnkey renovated family homes continued to fare well, as they do in most market conditions.

Indicative of the days on market, 21 Cedar Drive in Maribyrnong, a 4 bedroom 3 bathroom family home situated in a premier tree-lined street, was first listed mid-February with a price guide of $1.35m to $1.45m, selling at auction for $1.38m after 25 days on market.

Renovated and extended into a spacious 3 bedroom 2 bathroom family home, 60 Fehon Street in Yarraville featured indoor/outdoor living in a highly sought-after inner-village location. First listed end of February for between $2m and $2.2m, it sold for $2.53m after 23 days on market.

The second quarter saw increased caution despite no further interest rates, as buyers kept their intentions and strategies closely guarded. Although many buyers attended property viewings, the turnout at auctions was lower than expected. This did not seem to negatively impact the outcomes, as many properties sold within their anticipated price ranges, while others sold through post auction negotiations.

Renovated properties performed well, as the high cost of renovations continued to affect buyer sentiment, making them reluctant to take on fixer-uppers. For those willing to invest in some work, this sector held excellent investment potential. While a growing number of investors were compelled to sell their properties, with the inherent losses through capital gains tax increases forcing their hand.

Looking Ahead

Looking ahead to the winter months, the Inner Melbourne West / North real estate market is poised for moderate growth. Though a significant amount of off market stock is coming through from agents, stock of available properties is still quite low, suggesting that the market may remain steady. Potential homebuyers should be aware that inventory levels of new listings are expected to remain modest. Given this anticipated scarcity, it is advisable to act swiftly if you come across a property that aligns with your criteria and budget.

Buyers and sellers alike should prepare for a balanced market environment as we move throughout the year. Going to auction will ultimately determine the true market value of the property, and as always it is crucial for buyers to conduct thorough due diligence to avoid overpaying for properties. Emotional attachment to a property often leads to inflated offers, so it’s important to stay objective during the purchasing process.

With some vendors hesitant to list their properties and potentially having unrealistic price expectations, agents will need to collaborate closely with them. Navigating pricing strategies effectively is essential to achieve the best possible outcomes for vendors.

Elise Nemer from Jas Stephens Real Estate wrapped up, “I anticipate the market will continue in its current state for the next six months, pending an interest rate cut or increased confidence from buyers and vendors. Earlier this year, we saw a surge in buyer confidence and market activity when interest rates stabilized. A similar stabilization could lead to another market uptick”.