Melbourne Property Market: Are Investors Returning as Prices Lag Other Capitals?
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Hey, welcome back to the Real Estate Breakfast. Yes, breaking down for you the Australian property market. We are deeply into the year, aren't we? Next month is April. Christmas and New Year didn't seem that long ago, but it is well past us. And if you are a new listener, you'd like to get in touch with us with anything that is on your mind. Let's face it, 2026 has thrown up a few things that are concerning us right now. Our email address, as always, is myrealestatepodcast at gmail.com. Also got the voice recorder so you can leave a voice message. It is a Tuesday, March the 10th. If you're celebrating your birthday, many happy returns. Sharon Stone, the actor of Fatal Attraction fame, she is turning 68 today.
Yes, we will never forget the scene with Sharon Stone. Chuck Norris, he is chugging along, turning 86. And Carrie Underwood is turning 43. And it was a very big day today. on this day for Barbie Doll because Barbie Doll made her debut at the American International Toy Fair in New York for you Barbie lovers. And that happened way back in 1959. So from Barbie doll lovers to the Melbourne property market, which is presenting somewhat of a little bit of a conundrum for investors right now. On the surface, the headlines haven't been great. You've got the higher taxes, stricter rental standards and a perception that that Victoria isn't exactly rolling out the red carpet for investors. But when you look underneath that noise, something interesting is happening.
Prices have lagged behind other capitals for several years. Competition is smaller and some investors are quietly stepping back into the market. The question now is whether Melbourne is simply underperforming or setting up for its next growth cycle. So let's see if we can get a handle on some of that as we take you to Melbourne and catch up with Jared McCabe, a buyer's agent from Wakeland Property Advisory, where he is a director. And a very good morning to you, Jared. Welcome on to the Real Estate Breakfasts, and I guess you're too young to remember that Barbie launch, eh, back in 1959?
Yeah, a bit before my time, Craig, but my daughter still very much enjoys playing with them to this day.
Oh, come on, I'm sure you took your daughter to go and see that movie, eh?
I did manage to avoid that, and my wife took her along. Ha!
Fair enough. Millions of dads did go. All right, let's have a look at Victoria. We're talking about this, which has introduced some of the toughest property taxes in the country, high land tax and a 4% absentee owner surcharge and expensive rental compliance upgrades. It has made many investors pause, but some are starting to get back into the market.
And it's been a gradual thing, Craig, over the past sort of four or four years that some of these changes have occurred. And it's definitely led for a period of time, a number of investors leaving the market, particularly those that have been in place for a number of years, felt as though they weren't getting the capital growth that they perhaps expected and wanted. And then when some of these extra lags came on top, so that the extra, the higher land tax, the extra expectation on minimum standards from a rental perspective came in, it made it quite difficult to continue to hold property, especially then with you put the interest rate rises that came about a few years ago. It was sort of almost like the perfect storm and it made it quite difficult.
But that started to change because there's been a new wave of buyers coming in, a new wave of investors looking at Melbourne and certainly saying that it appears to be very good value.
Yeah, because over the last five years, Melbourne's property values have grown just over 12%. While cities like Brisbane, you've got the Perth, you've got Adelaide in there, they have surged far higher. And that underperformance... really has pushed Melbourne down the affordability ranking and suddenly making Australia's second largest city look comparatively cheap for investors.
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