South Melbourne home prices double in five years

May 24, 2018 by  

Historical inner suburb South Melbourne has seen median house price growth far surpassing already exponential citywide trends.

The amount buyers are paying has now doubled in the past five years rather than the expected ten. A single-storey workers’ cottage in Lyell Street recently sold for $1.61m after previously being sold for $975,000 in 2013. The area, originally known as Emerald Hill, is also attracting bids of over $1m for penthouses in many of the new apartment complexes being developed. South Melbourne’s attraction for upwardly mobile professionals working in the nearby CBD make it a useful market for businesses promoting themselves through corporate gifts and other promotional products.

Apart from its proximity to the CBD, ongoing changes to South Melbourne’s market and cafe culture are likely behind the growth in real estate interest. After a marked downturn in the 1950s and 1960s as Melbourne’s suburban growth began to sprawl, the area started to gentrify in the 1980s following a wave of immigrants. Since then Clarendon St in South Melbourne’s centre has become the most expensive rental real estate in the city, while the local market has continued to attract residents from all over the metropolitan area.

Recently, a move from upmarket luxury stores and sports bars to a vibrant restaurant and cafe culture has done much to change prospective home buyers’ impressions of South Melbourne, as well as the adjacent Albert Park and Middle Park areas.