Michael Grochowski on:
Multicultural Melbourne Continues to Support Investment in Property
Melbourne has always been a culturally diverse city. The post war immigration boom saw Melbourne become the centre of the largest Greek population outside Athens, for example. The attraction of Melbourne as the “World’s Most Liveable City” continues.
The latest census data (2011 census) shows English has declined in percentage terms as the only language spoken at home. Greek and Italian are the second-most common languages spoken at home, other than English.
This all adds to, and strengthens, Melbourne’s image and reputation as a multi-cultural city and this reality shows up socially, culturally and economically in all aspects of life in this city.
However, the attraction of Melbourne also has a downside and that is in the increasing pressure to house not only the existing population but also the steady stream of new arrivals.
New arrivals, in particular, tend to start their new life here in rental housing. But rental housing takes an increasingly large share in weekly incomes.
While the individual median income has gone up by about 23 percent since 2006, to $591, rents across Melbourne have gone up 50 percent a week, and monthly mortgage payments up almost 35 percent in that time.
Fewer than one third of Melbournians now own their own house outright. This figure is down from 34.7 percent in 2006, and the number of people renting has increased by 2 percent.
During the same period, Melbourne’s housing stock has increased by 145,000 new homes, but Melbourne’s population continues to grow at more than 70,000 per year. This creates a demand pressure on available housing which is pushing up rents and helping maintain prices for houses in both older established areas and more importantly in the new suburbs of Melbourne’s three main growth corridors to the east, north and west of the city.
For the property investor able to finance an investment in these growth regions, the future is assured, underpinned by plenty of demand, stable and rising rents and generally rising house and land values over the longer term.