With only one development scheduled for completion in Docklands in 2015, competition from prospective tenants is set to increase.
The property market in Docklands is strong, with the popularity of inner city living showing no sign of abating and the demand for high quality living and a low-maintenance lifestyle continuing to build. A choice of premium lifestyle developments with a superb level of amenities and a unique waterfront location has enabled Docklands to become a thriving suburb and a destination of choice for owner occupiers, investors and tenants alike. Perfectly positioned on the edge of Melbourne’s CBD, Docklands offers a range of accommodation options for tenants and a great choice of restaurants, shopping, entertainment and transport options.
The Docklands rental market continues to perform strongly, with the median weekly rent for all apartment types (1, 2 and 3 bedrooms) much higher than across metropolitan Melbourne. The median weekly rent for 3 bedroom apartments in Docklands is $900 per week, well in excess of the median for Inner Melbourne of $600 per week. Current rental demand for Docklands is also evidenced by Lucas Real Estate’s exceptional average vacancy rate of 2.14% when compared to the current rental vacancy rate in Melbourne of 3.1%. (Source: REIV)
Whilst appealing to a wide range of tenants, Docklands has been particularly popular with working professionals of all ages due to the affordability, accessibility and generally larger than average size of accommodation offerings. The calibre of local tenants is demonstrated in an exceptional arrears rate of 2.34% - well below the ideal industry average of 4%.
We predict 2015 will again be a strong year for local investors, with low levels of supply allowing an increase in competition from prospective tenants. With only one development scheduled for completion in Docklands in 2015, we expect to see prices remain steady and great potential for higher rental returns. The forthcoming infrastructure investment of the Montague train station and the rejuvenation of adjoining suburbs of E-Gate and Fishermans Bend will further increase rental demand and values in Docklands long-term.
Published by the Real Estate Conversation