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In the year to May, Brisbane house prices rose 15.9 per cent, Sydney 10.3 per cent, Perth 25.3 per cent and Adelaide 15.3 per cent. Melbourne house prices rose just 2.4 per cent over the year.
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Nicola McDougall, president of the Australian Association of Property Investment Professionals, said a large number of investors had left Victoria, mainly due to Land tax increase in 2023 For investors, it’s not just the pressure from state governments, but also rising interest rates and other costs and taxes.
“Victoria, more than most other states, has seen a lot of policies that are seen by investors as anti-investor during a period when interest rates were really high,” Mr McDougall said.
“Fundamentally, this move will reduce the supply of rental housing, making the current rental crisis across the country and in Victoria more entrenched and prolonged, with rents continuing to rise for the foreseeable future.”
According to statistics, Melbourne’s vacancy rate has dropped to a historic low of 0.8%. Domain name data for February. Median rent increases 14% YoY growth The Domain Rental Report shows rents were $570 per week in the March quarter.
“The fact that house prices are flat or falling is actually good news from an affordability perspective,” said CoreLogic head of residential research Eliza Owen. “The fact that Melbourne prices are now lower than Brisbane prices may actually attract more people back to the city.”
The state government announced a so-called COVID-19 debt levy in the 2023 state budget to recover an extra $4.7 billion from property investors over four years through increased land taxes.
The government has also recently expanded the vacant residential land tax to include an additional 1%. Undeveloped residential land tax The scheme, which has been in place for more than five years in established Melbourne areas, will also see stricter energy efficiency standards applied to rental properties from October 2025.
Melbourne residents also face the highest stamp duty in the country, with the average homebuyer paying the equivalent of six months’ take-home pay for a typical home, compared with about double that amount at the turn of the millennium, a recent report by economic research group e61 shows.
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A survey released in September by industry body the Property Investment Professionals of Australia found Victoria was ranked as the least attractive state in the country for property investors.
The survey also found 24.8 per cent of respondents sold at least one investment property in Melbourne in the 12 months to August last year, also the highest proportion nationally.
The state government has set a target to build 80,000 houses per year The plan will help ease pressure on the housing market over the next decade and promises to increase density in existing suburbs rather than further expand on the fringes.
While the state was building record numbers of homes before the pandemic tanked its economy, more recently it hasn’t been building enough homes to even keep up with rapid population growth, let alone put downward pressure on home prices and rents.
For example, work started last year Only 53,711 housesapartments and townhouses, well below the annual target.
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