The $5 Million home? No need to be afraid!

The first set of numbers that caught our eye involved a report called ’25 Years of Housing Trends’ which was prepared by the analysts at Corelogic. This report looked at the Melbourne property market over the past 25 years and found that our median house price had increased by an average of 8.1 percent. Interestingly, if our market increases at the same rate for the next 25 years, the median house price in our fair city would be $5.8 million in 2043!

If you’re wondering about the Melbourne unit market, the rate of growth over the past 25 years was found to be 6.6 percent. This would mean that the same rate of growth for the next 25 years would make the median value $2.8 million!

Is your mind boggling yet?

Well, the news is not as frightening as it first seems. Another set of numbers that we came across came from the financial analysts at Canstar. They found that despite the growth in property prices, Australians are currently committing around 39 percent of their annual after-tax income to paying off a home loan. If you go back to 1995, that figure was actually 40 percent…slightly more than what we’re paying today. Obviously, our record low interest rates have played a part in this, but it does put an interesting spin on it all, doesn’t it?

As we are always telling people, property is a long-term purchase, not a short-term prospect. Or as another old saying puts it, “Don’t wait to buy real estate…buy real estate and wait!”

That’s exactly what happened with the solid brick Victorian in Livingstone Parade, Preston which is another recent sale that our team completed for a vendor who was prepared to wait for the right buyers. It’s another terrific local result, selling for $935,000.

Remember, if you need any advice or assistance on any property matter, you can give us a call at Barry Plant Preston any time.