The latest Residential Property Prospects report by Oxford Economics Australia projects national unit prices will surge more than 17% between now and December 2026. Over the same period, house values are tipped to grow by 12%.
So what does this mean? The most apparent factors behind the potential outperformance of units over houses is location and affordability. As house prices in Melbourne continue to rise despite multiple interest rates, many buyers, particularly first-time buyers and investors are finding units a more financially accessible option. Units offer a lower entry point into the market, which is increasingly attractive in a city where housing stock is limited and there are record low vacancy rates for rentals.
Lifestyle factors also mean that buyers are choosing suburbs closer to work, study or the city rather than moving further out and their budgets are usually better suited to a unit or apartment in order to live in their preferred location. Units also offer a low-maintenance housing option or a city base for people who have rural properties and divide their time between the two.
Here in Banyule we’ve observed higher buyer interest in the unit, townhouse and apartment market as well as significant increases in the median price for units in our key suburbs:
Banyule Median Unit Prices *
Overall Banyule Median Unit - $760,000 | Melbourne Median Unit $633,000
Ivanhoe - $895,000
Ivanhoe East - $1,000,000
Eaglemont - $810,000
Rosanna - $900,000
Viewbank - $740,000
Macleod - $856,000
Heidelberg Heights - $721,000
Heidelberg - $651,250
Notable recent sales
2/47 The Boulevard, Ivanhoe - $1,295,000
5.02/68-72 Cape Street, Heidelberg - $850,000
2/91 Ivanhoe Parade, Ivanhoe - $1,251,000
1/45 Hillside Road, Rosanna - $1,310,000
6/141 Brown Street, Heidelberg - $915,000
Whilst traditionally the Australian dream was a house with a backyard, high population growth, affordability and changing lifestyles are shifting the focus towards units and apartments. In the last 12 months on realestate.com.au house searches have decreased slightly and unit searches have been increasing - a trend that is likely to continue as Melbourne transitions to Australia's biggest city.
If you are thinking of buying or selling your property, please get in touch.
