Alphington surpasses all other Melbourne suburbs with 65.2% growth over last 5 years.

A diverse mix of Melbourne suburbs have boomed over the past five years as both affluent and affordable neighbourhoods had their property price growth driven by the super-charged COVID price cycle.

Alphington, in the city’s leafy northeast, had a spike in its median house price in the five years to March, up 65.2 per cent to $1,975,000.

Melbourne
Growth over five years to March 2023

The suburb with the next highest rise was Patterson Lakes, in the city’s southeastern growth corridor, up 50.3 per cent to $1,345,000.

They were followed by more affordable Lyndhurst (46.8 per cent), bayside Elwood (44.2 per cent) and, further afield, Frankston South (43.5 per cent).

Unit medians rose the most in Brighton (54.6 per cent), Balwyn (44.8 per cent) and Carrum Downs (35.7 per cent). The analysis excludes tree-change locations statistically counted within greater Melbourne.

Domain chief of research and economics Dr Nicola Powell said the flight of people from the inner-city during the pandemic and lockdown periods was responsible for the massive growth in these suburbs.

“There’s a mix of suburbs, but those more expensive suburbs tick the lifestyle box and the others are more value for money, family-oriented suburbs, which reflects the major trends we saw during COVID,” she said. “This is a really interesting capture of data because obviously it’s capturing pre-COVID and the entire COVID price cycle.

“Melbourne had the greatest demographic shift out of anywhere in Australia. Melbourne saw the weakest upswing in house prices overall in all of our capital cities, but some areas boomed and those were those outer suburbs.”

Former Alphington resident of 22 years Michael McInnes said he attributed the suburb’s growth to the gentrification of his old neighbourhood.

“It has progressively gentrified. In our street we had three lawyer couples and when we left we sold to a doctor couple,” he said. “I guess that’s because the prices have gone up and up and up.

“It’s a sought after spot, the cliche is that real [estate] agents would refer to it as a ‘tightly held spot’. It’s only people like us who want to downsize who move on, I think.”

McInnes said he and his family had enjoyed their time in Alphington.

“It was a very comfortable place to live,” he said. “The beauty of Alphington is that the proximity to everything is quite good. It’s close to the city, it has reasonable public transport.”

Nelson Alexander agent Tom Breen sold the McInnes’ house, and said the area had become a kind of northside Kew.

“It’s still close to the city but you have a family feel,” he said. “You’re close to the private schools like Ivanhoe Grammar and schools in Kew.

“It’s good value compared to Kew and Hawthorn, even if they’re just across the river. You get that for half the price and people are starting to realise.”

Asset Property Sales director Justin Maher sells in Patterson Lakes, and said his area had strong growth over the past five years despite its relative anonymity.

“No one knows about it. Locals want to keep it quiet,” he said. “All in all it’s underrated. It’s undervalued because no one knows about it.

“It’s like a gold mine ready to hit the roof when people know what Patterson Lakes has to offer.”

Maher said the area had benefited from the COVID price boom, but because it was a tightly held suburb it had easily weathered the recent interest rate-induced decline.

“Patterson Lakes gradually went up and it didn’t have the correction,” he said. “It just comes down to the fact it’s just great value for money.”

“People were selling in the inner-city, cashing in for $2 million to $3 million and saying: ‘hey, I can work from home now, and I want a water view’.”

Belle Property St Kilda head of sales Julian Cannata said Elwood had performed well because of a gradual gentrification in the area.

“One thing that I’ve noticed in more recent years is there has been a whole lot more high-end renovation and development in the suburb,” he said. “We used to sell a lot of period homes that were quite original or had some renovation but weren’t to the level we’re seeing these days.

“Yes there’s been growth in the suburb, but the quality of product being sold is higher which is propping up the prices.”

Cannata said the Elwood market was an alternative to some of the more popular suburbs in the area.

“Elwood’s quite unique in that it’s almost a hybrid between St Kilda and Brighton,” he said. “It’s its own little market. I think people in Elwood like the proximity to St Kilda, but they feel like it’s suburban enough that they get their privacy.”