Suburbs where first home buyers are winning at auction

First home buyers are winning at auction in 23% of cases in the Melbourne suburb of Reservoir, according to new data from the Real Estate Institute of Victoria.

This matters now because the Victorian government's recent extension of the Homebuyer Fund, which provides up to 25% of the purchase price for eligible first home buyers, has increased demand for affordable properties in the city's outer suburbs. With Melbourne's median house price sitting at around $920,000, many first home buyers are being priced out of the inner-city market and are looking to areas like Reservoir, where the median house price is $830,000, and Hadfield, where the median house price is $750,000.

In the north, suburbs like Coburg and Preston are also proving popular with first home buyers, who are being drawn to the area's relatively affordable prices and proximity to amenities like the Coburg Lake Reserve and the Preston Market. The City of Darebin, which covers these suburbs, has seen a significant increase in first home buyer activity in recent months, with many buyers taking advantage of the state government's First Home Owner Grant, which provides $10,000 towards the purchase of a new home.

Local market trends

Data from the REIV shows that in the June quarter, first home buyers were successful in 17% of auctions in Melbourne's outer suburbs, compared to just 10% in the inner suburbs. In the suburb of Frankston, which is experiencing significant growth and development along its corridor, first home buyers won 20% of auctions, with a median house price of $680,000. Meanwhile, in the Bayside suburb of Hampton, first home buyers were successful in just 5% of auctions, with a median house price of $1.2 million.

For first home buyers looking to get into the market, experts recommend doing their research and being prepared to act quickly when the right property comes along. This includes getting pre-approval for a loan, having a clear understanding of the auction process, and being aware of the various grants and schemes available, such as the Homebuyer Fund and the First Home Owner Grant. With the right preparation and a bit of luck, first home buyers can still achieve their dream of owning a home in Melbourne, even in the current competitive market.