If you’re looking to buy in Melbourne, you’ll ideally want to buy in an area which will see solid growth in the near and long-term future. We’ve put together a list of the top ten suburbs that may see strong capital growth.
10 best Melbourne suburbs for high capital growth
Only 23 kilometres from the Melbourne CBD, Park Orchards has an average rental yield of 2.86%. Although expensive with a median sale price of $1,835,000, the suburb has seen year-on-year growth of 22%, so buying here may see your investment quickly rise in value.
Aberfeldie sits on the edge of the Maribyrnong River and is just nine kilometres north-west of the Melbourne CBD. The suburb has a $1,642,500 median sale price and is in high demand, sporting an average rental yield of 2.3%.
Arguably most famous for its footy club, Collingwood may also be a great suburb to buy in this year. With a median price tag of $1,140,000, Collingwood has seen year-on-year change in sale price of 30%, with a healthy rental yield of 3.4%.
Hughesdale is situated 15 kilometres south-east of the Melbourne CBD and has seen solid change in its year-on-year median sale price of 28%. The suburb has a median sale price of $1,362,000 and a rental yield of 2.46%.
Although 55 kilometres south of the CBD, Tyabb may be the place to grab a bargain this year. Tyabb has a median sale price of just $892,500 and has seen a massive change in the median sale price of 47%. It also boasts an impressive rental yield of 3.98%.
Mont Albert North
Mont Albert North is located in close proximity to the Melbourne CBD, only 14 kilometres east. It boasts a median sale price of $1,525,000, which has seen a strong year-on-year change of 21%. Although not the highest on this list, it has a promising 2.22% rental yield.
Box Hill South
Great for families, Box Hill South is only 15 kilometres east of the CBD. It has a median yearly sale price of $1,281,444, with a year-on-year growth of 28%. It also sports a solid 2.38% rental yield.
Situated in Melbourne’s north-east, 13 kilometres from the CBD, Heidelberg has a median sale price of $1,269,000. It’s seen a strong change in the yearly sale price of 23% and has a solid rental yield of 2.58%.
On the doorstep of the CBD, only four kilometres away, Kensington is a high-demand gem. With a reasonable median sale price of $1,121,000, the suburb has seen a 25% increase in the yearly sale price. It also has a strong rental yield of 3.03%.
Another south-eastern suburb which may be a solid buy this year is Murrumbeena. The suburb has a decent rental yield of 2.51% and a median sale price of $1,410,500. The sale price has seen strong yearly growth of 22%.
Tips if you’re buying a second home
If you’re looking at buying your second home, either to live or invest, you may be able to access the equity in your current home to finance the new loan. We’re currently offering a one-year discount variable rate of 1.99% p.a. (2.47% p.a. comparison rate) when you refinance with us now. Check out how much you could save by refinancing with our calculator here.
Tips if you’re a first-home buyer
While buying in a suburb with strong capital growth opportunities is important, if you’re a first home buyer you should also consider a number of other things. Depending on where you are in your life, you should consider the location of the suburb. If you are looking to start a family or already have one, you may want to be close to amenities like schools, parks, and sporting facilities. If you’re a young professional, proximity to the city or public transport facilities is likely to be important.
If you find the suburb you’re keen on is too expensive and you don’t want to wait to build up more money for a deposit or to be able to handle repayments, look at the surrounding areas. Melbourne is a rapidly growing city with great infrastructure, so moving a bit further away from your desired location may save you money while also not costing you too much of a commute time.
If you want to see how much you could borrow with us to buy your first home, use our borrowing power calculator.
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