PHOTO: Mia Jardon and Brent White with daughter, Florence outside their unit which is up for sale. Photo: Stephen McKenzie
Melbourne’s unit prices are at a record high but are set to blow out even further this year as young buyers abandon their dreams of a house and turn to apartments instead.
Melbourne’s median house price soared past $1 million in the June quarter, defying the pandemic to set a record and raising fresh fears over housing affordability.
Units also hit a record price, rising to a median of $572,793.
While the cost of a unit sits at nearly half that of a house, experts say affordability issues will force many in the market, particularly first-home buyers, to purchase apartments rather than houses, which will then drive unit prices higher again.
Domain chief of research and economics Nicola Powell said the higher house prices climbed, the more demand would flow into units.
“Some people are forced to buy a unit in their designated suburbs,” Dr Powell said. “It’s about them getting that first rung on the ladder and it has to be a unit because house prices are so high.”
All but two of the Melbourne regions registered unit price increases over the past year, particularly in the north-east (up 8.5 per cent) and the outer-east (up 8.3 per cent). Units on the Mornington Peninsula skyrocketed by 18.7 per cent over the year to June.
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