This article was originally published by Samantha Landy, Herald Sun,
ALMOST half of Melbourne’s homes are worth at least double the price their owners paid for them.
CoreLogic data reveals the proportion, 47.3 per cent, is up from 38.1 per cent ten years ago.
Experts say homeowners in the city are reaping the benefits of a property market that’s entered “new paradigms” after years of sustained price growth.
A substantial 40.8 per cent of regional Victorian homes are also valued at twice as much as their purchase price.
On the flip side, just 2.1 per cent of dwellings in Melbourne and 3.1 per cent in the state’s regional areas are worth at least 10 per cent less, according to CoreLogic.
CoreLogic says 47.3 per cent of Melbourne homes are worth double the price they last sold for.
Homeowners are also in a strong equity position in Sydney, where 48.1 per cent of homes have doubled in value and just 0.7 per cent have declined by at least 10 per cent.
“The strong capital gains across the Sydney and Melbourne housing markets have created a significant boost in wealth for homeowners who were fortunate enough to own a property through the latest growth cycles,” CoreLogic head of research Tim Lawless said.
Mr Lawless said it was a different story outside Australia’s two priciest property markets, with homeowners in the other capitals now seeing “far less accrued equity from their housing assets”.
CoreLogic head of research Tim Lawless said Melbourne’s strong capital gains had created “a significant boost in wealth” for homeowners.
The proportions were 37.4 per cent in Hobart, 34.3 per cent in Perth, 33.7 per cent in Brisbane, 29.1 per cent in Adelaide and 25.9 per cent in Darwin.
The figure is 39.1 per cent nationally — down from 45.4 per cent a decade ago.
Further CoreLogic figures show the median house prices of eight Melbourne suburbs have doubled in the past five years.
They are South Yarra, South Melbourne, East Melbourne, Huntingdale, Flinders, West Melbourne, Parkville and St Kilda West.
VFL star Simon Beasley’s former home at 21 Leopold St, South Yarra fetched $1.8 million at auction last weekend. It had last changed hands for just $125,000 in 1986.
A stack of others have enjoyed gains of more than 80 per cent.
Jellis Craig director Andrew Macmillan said traditionally, the rule of thumb was that houses doubled in value after eight years.
“But the property market is entering new paradigms,” he said.
“It’s moving at a pace we’ve never seen before.”
But Mr Lawless said as price growth eased across Melbourne, and to a larger extent Sydney, these trends may slowly start to reverse.
“It will be harder to double the value of a property in (these cities) after such a sustained period of high capital gains,” he said.