News

The latest happenings in the Melbourne property market. For our Essays and The Secret Agent Report, see our Research page.


Bond Yield Update: February

official yields on australian treasury bonds 2016While many media outlets paint a rather bleak and uncertain future for the world economy, long-term bond yields in Australia finished 2016 higher than at any other point throughout the year.

This is even more impressive considering that the cash rate (which has a strong correlation with bond yields) was cut twice for a total of 50 basis points over 2016. Figure 1 shows how much long-term rates increased towards the end of last year and into 2017. Yields on 10-year Australian government bonds have increased by 74 basis points since September and nearly 100 points since the last interest rate cut in August. Read the full post


The Perfect Ratio of Period Terrace House to Land

Diagram showing the range of ideal land to indoor area ratio in attached and freestanding terraces including an increase in sale price.

Last month, Secret Agent investigated the ‘sweet spot’ in the density of a townhouse. We found that a total indoor area that equalled or slightly exceeded the land area (i.e. 1:1 – 1:1.27) sold at a higher price than denser developments. This time we decided to see what the data says about period homes.  Read the full post


The Secret Agent Report – Terraces & Townhouses: Price Per Internal Square Metre

Diagram showing how Secret Agent's price per internal square metre index is calculated compared to the current industry standard

We have just released our latest Secret Agent report!

In this report, Secret Agent proudly presents our Price Per Square Metre Index for period homes and townhouses in inner Melbourne. This is Melbourne’s first price per square metre report based on actual internal usable space, and not land size.

Access the Terraces & Townhouses: Price Per Internal Square Metre report now!


The Ideal Ratio of Indoor Space to Land Size in Townhouses

Diagram showing the ideal density of a townhouse in terms of its ratio of outdoor space to indoor space

What is the ideal ‘density’ of a townhouse development?

Across inner Melbourne, townhouse developments are becoming increasingly common. With limited block sizes closer to the city, developers have to constantly negotiate the size of the actual house with the amount of land available. Because of these varying levels of building density, Secret Agent wanted to find out if there was a ‘sweet spot’ in the ratio between indoor area and land area. Are we paying more for a certain ratio? Read the full post


In 2016, We Paid More for Older Apartments

Illustration showing that buyers paid 38 thousand dollars more for low-rise, older apartments in 2016 compared to newer apartments

This week, Secret Agent compares new and old apartments around inner Melbourne to see which were more valuable in 2016.

The sample included 1674 apartment sales across inner Melbourne’s suburbs and the CBD from January to December 2016. New apartments are those built from the 90s onwards, excluding any recent off-the-plan apartment sales. Old apartments include Art Deco units and flats located in 60s to 80s brick buildings. Read the full post


The Price of Better Designed Apartments

Illustration showing an A-grade apartment receiving adequate sunlight, having views outwards, cross-ventilation and sufficient private outdoor space.

How much more are we willing to pay for a cross ventilated, well-lit apartment with a balcony and open views?

In March this year, apartment design standards will be implemented into the Victorian planning system. Apartment design standards will ensure all future apartments in Victoria are desirable, safe, healthy and sustainable. New developments in Victoria will only be permitted a planning permit if they meet these standards. A 2015 community survey found that the top concerns of apartment amenity were “access to daylight, functional space, and natural ventilation”, as well as noise and energy efficiency. (DELWP, 2)

Standards have been made for 16 elements of design: Building setback, functional layout, room depth, windows, storage, noise impacts, energy efficiency, solar access to communal open space, natural ventilation, private open space, communal open space, landscaping, accessibility, building entry and circulation, waste and recycling, integrated water and storm water management.

It is logical to think that better design standards should produce apartments of a higher quality. This in turn should increase the sale price of these apartments. Secret Agent was engaged to determine the price premium of better designed apartments. That is, how much more are consumers willing to pay for an A grade apartment compared to a B grade and C grade apartment? Read the full post


How much value does a balcony add to an apartment?

Diagram showing that balconies cost 2800 per square metre in 1 bedroom apartments and add up to 11.7 percent more to its sale price

This week, we take a closer look at balconies and other types of outdoor area in apartments. While no doubt desirable, many developers are uncertain how much value outdoor space will create for them. This was reflected in our Supply report, which showed that outdoor space for both one and two bedroom apartments being planned in Melbourne was barely above the minimum suggested in the Victorian Government’s recent apartment design standards draft. Read the full post


Happy Holidays!

Illustration of Donald Trump wearing the uniform of the Ballarat footy team, holding a torn British flag, sitting on a disgruntled black swan, while doing a thumbs up.

Secret Agent would like to wish you a Merry Christmas and Happy Holidays!

Thanks for your support this year and we look forward to catching up in the new year.

Our office will be closed from the 24th December 2016 to 8th January 2017.


The Secret Agent Report – End of Year Review

We have just released our latest Secret Agent report!

In this issue, we provide a deep overview of the year in terms of the yield curve, apartment price per square metre rates and capital growth, concluding with a wrap up of each area’s performance in 2016.

From all of us at Secret Agent, we wish you a very happy holiday season!

Access the 2016 End of Year Review report now!

secret agent report end of year review 2016