This article was published by by Christina Zhou via afr.com.au, 15 Nov 2016 | Image: This three-bedroom home at 30A Belmont Road West, Croydon South, sold for $605,000.Fletchers
Melbourne’s lower-profile suburbs are now high on buyers’ wish lists, selling three times faster than the rest of the city.
Most houses sell privately in Frankston North, but local agents say properties there are generating so much interest that it is now ready to embrace the auction culture.
Outer suburbs including Croydon South, Kilsyth and Bonbeach are also more in demand as buyers continue to be priced further out from the city.
Houses in Frankston North took on average just 21 days to sell, much faster than the city-wide average of 65 days over the September quarter, Domain Group data shows.
The days on market data comprises just private sales — excluding auctions — and is another measure of demand and correlates with prices growth.
Simon King, of agency Eview Group, said subdividable blocks in Frankston North were “going through the roof”.
Savvy investors paid premiums because they could renovate the front house and build a new townhouse in the back, he explained.
“I can’t hold them for any more than seven to 14 days,” Mr King said, adding that it might take longer if the property was subject to finance or a building and pest inspection.
A rundown three-bedroom house on about 726 square metres at 31 Hickory Crescent, with potential for subdivision, sold for $410,000 last month after receiving more than 25 offers. Last year, similar properties were selling for about $320,000, he said.
Frankston’s median house price soared 8.5 per cent over the past year to $352,500.
O’Brien Real Estate’s Andrew Milne said more owner-occupiers were now buying in the area because it was still affordable, and there were usually multiple offers on properties.
“Traditionally we’ve focused on private treaty sales in [Frankston North], but now it’s getting to a point that we could start auctioning our properties,” he said.
“Even properties that are in pretty poor condition are selling for around the $360,000 to $390,000 mark.”
Speedy private sales in Croydon South and Ferntree Gully — less than three weeks on average — shows the revival of activity in the outer east, according to Domain Group chief economist Andrew Wilson.
Outer-easterns suburbs including Forest Hill and Blackburn also clocked 100 per cent clearance rates for houses over October, he said.
Croydon South was popular because it abutted Ringwood East, which had its own train station, Hocking Stuart Ringwood’s Travis Milton said, adding that it was relatively affordable and had good access to Ringwood’s infrastructure such as Eastland shopping centre.
Several houses auctioned recently in the pocket soared more than $120,000 over reserve, including a four-bedroom house at 33 Olympus Drive, which pulled five bidders and sold for $875,000.
Units sold swiftly in Boronia, East Melbourne and Croydon, taking fewer than 31 days on average to sell over the September quarter.
Boronia was a suburb with established infrastructure such as a train station, shopping facilities and hospitals, unlike growth suburbs waiting for infrastructure to catch up, LJ Hooker Boronia director Julien Karolos said.
“That’s why all the outer-eastern belt are growing really fast — it might be Boronia this month, Bayswater next month and Croydon the following,” he said.