The Melbourne CBD property market seems to be saturated. While the amount of stock in most inner city suburbs has dropped this year in comparison to last year, the CBD has increased.
While stock levels through the CBD continue to increase, the amount of sales has not – leaving a spill over of property that is not sold and just sitting on the market. For example in the month of December 2012 841 properties were on the market with only 50 sales taking place – this number very similar to the number of properties sold in December 2011.
Some property in the CBD has been sitting on the market for over a year. The reason for this comes down to the amount of property located in the CBD and then the quality of that property.
The CBD is full of high density living (apartments) and very few buildings that possess top notch quality. There are some buildings of great quality, like the Melburnian, however these are few and far between.
Photo by Nova Photography
If we compare this with the suburb of Fitzroy, where 25 properties were on the market in December 2012 and 10 sold throughout the month. Given there is a much smaller number of homes in the suburb this is to be expected, however the ratio of homes on the market that sell are far higher.
With stock levels declining in many inner city suburbs, it will be interesting to see whether stock levels in the Melbourne CBD follow trend or continue to flood as they have in previous years, with the new construction looming and many developments now settling it’s doubtful we’ll see a shortage in the near future.
Secret Agent welcomes Emma Paterson. Emma assists with acquisition, market research and the buying process.