In CoreLogic's data, the proportion of properties held by investors has surged to 60% in Melbourne's central area, marking the highest in a year. Areas in Melbourne such as Geelong, Whittlesea-Wallan, Melton-Bacchus Marsh, Glen Eira, and Casey South have also seen an increase in the proportion of properties held by investors over the past three months.
Real estate analysts suggest that this trend is likely to continue in the coming months. This situation reflects the relatively sluggish growth performance in the Melbourne and Sydney markets, as well as the high mortgage repayments and additional compliance costs due to recent state policies, making it increasingly difficult for many landlords to maintain their investment properties.
Real estate agents indicate that, with all these added costs, the investment returns have been rather poor, and with the dual pressure of high mortgage repayments and additional taxes, property investments here are becoming increasingly unprofitable.
The Victorian government has implemented several policies impacting the real estate market, including reducing the land tax exemption threshold from $300,000 to $50,000 and adding a 0.1 percentage point tax rate to properties valued over $300,000.
Additionally, Victoria plans to impose a 7.5% tax on Airbnb properties and expand the application of the "vacant residential land tax" statewide, which applies to residential properties vacant for more than six months within a year.
CoreLogic's data shows that the Melbourne apartment market has generally lagged behind the overall market performance over the past five years. The value of apartments in Melbourne's CBD has only increased by 1% over the past three months and remains 0.6% lower compared to a year ago. Looking back over five years, the current value is still 1.2% lower than it was five years ago.
A similar situation is also evident in Sydney. In the past three months, the number of listings of properties held by investors has increased in the central area, Ryde, and the Eastern Suburbs, by 17%, 35%, and 29% respectively.
Of the 463 new listings in Sydney City, 266 were held by investors. In Ryde, 113 out of 268 listings were investment properties, while in the Eastern Suburbs, 93 out of 216 listings were investment properties.
Australian Prime Minister Scott Morrison has stated that the tax regulations in Victoria have cast a shadow over the overall economy of Australia, and he hopes the state government will consider retracting these policies. However, the Victorian government has consistently emphasized that these measures are intended to safeguard the stability and order of the housing market.
