Inner Melbourne average Q1 2017: $8,882/m2
Inner Melbourne average Q1 2016: $8,622/m2
Percent annual growth: 3.02%
On average, apartments increased in price by $260 per square metre, or 3% over the past year.
One bedroom apartments have remained about the same in nominal terms (which means they have fallen in value in real terms) and are now the cheapest apartments at $8,650 per square metre. All other apartments increased in price, with 4 bedroom apartments now averaging $11,450 per square metre. Not many of these properties get sold each quarter, so prices tend to fluctuate a bit. Similarly, three bedroom apartments increased in average price by about $1,000 to $9,400 per square metre in the first three months of 2017. Two bedroom apartments are also up slightly ($8,900/m2), while studios were more expensive than 1 and 2 bedroom apartments over the past three months ($9,200/m2).
East Melbourne was the most expensive area for apartments so far in 2017 ($11,850/m2), selling for more on average than Fitzroy ($11,600/m2) and Middle Park ($11,450/m2), which was at the top of the table over the first three months of 2016. Inner West suburbs, including Travancore, Kensington and Flemington continue to be the most affordable regions, with average apartments in these suburbs costing buyers between $6,000 and $7,800 per square metre. Average prices per square metre of indoor space increased the most in the inner North, with the suburbs Brunswick, Fitzroy, Carlton North and North Melbourne all increasing by over 10% since Q1 2016. The only exceptions are Fitzroy North, Carlton and Brunswick East, which saw average prices decrease by 11, 5.5 and 3 percent respectively.
As the year continues and many more apartment projects are completed in inner Melbourne, we expect apartment prices to continue flatlining or even decreasing. However, larger apartments are still a rarity, as shown by our recent reports on supply and apartment standards. This makes it likely that three and four bedroom apartments will remain the most expensive both in terms of average prices and on a square metre basis.