After a great evening presenting our new project in Ivanhoe to our network of finance professionals and clients, it’s only fitting that we publish an article on the Blue Wealth Pick for 2018.
Ivanhoe sits 12 kilometres from Melbourne’s CBD and is often associated with leafy streetscapes, character housing and a very affluent demographic. The suburb median incomes are 35% higher than Victorian averages, a great indication of the type of resident. For those Sydneysiders who are reading, the perception of Ivanhoe from Melbournite’s is like that of Lane Cove.
I’d love to delve into all the details, however here are a few of the key aspects which headlined our research of Ivanhoe and were featured at the property launch last night:
Melbourne’s north-east – Building the way to price growth
Although very desirable and home to the traditional growth drivers, one factor which has been a deterrent to its growth to date and also resulted in the premium for the city’s south-east is connectivity. There are currently two infrastructure projects underway which will significantly improve this:
- The Chandler Highway Upgrade involving the expansion of an existing bridge which is the main arterial road into Melbourne’s north-east
- The North-East Link is the construction of a new motorway for the north-east which has always been described as the ‘missing link’
Employment and Education
The north-east of Melbourne also benefits from 3 key employment hubs. Along with its proximity to the CBD these hubs provide residents with local, high quality employment opportunities:
- The Austin Health Precinct – employs over 9,000 people
- Preston Industrial Precinct – over 1,000 employees
- La Trobe University – 35,000 students and 3,000 employees
High quality schooling opportunities are also held in high regard by the local families. Some of these include:
- Ivanhoe Grammar
- Ivanhoe Girls Grammar
- Alphington Grammar
- Trinity Grammar School
- Ruyton Girls School
Value
Most importantly, the value proposition from both a suburb and project perspective are nothing short of exceptional.
On average Ivanhoe is 33% or $517,000 cheaper than its neighbouring suburbs. This gap is unprecedented and represents the potential capital growth in the Ivanhoe market.
The value proposition of apartments as an asset type is also very strong. We identify the gap between the cost of houses and the cost of apartments as the HUG (house unit gap). Currently, homes in Melbourne are 52% more expensive than apartments, higher than it’s ever been in history. In Ivanhoe, homes are double the price of apartments indicating an unsustainable gap and an opportunity for apartment price growth.
Identifying the right suburb can be key to outperforming the wider capital city market. Historically, Blue Wealth suburbs have outperformed capital city averages in all cities on our eastern seaboard.
All of this and more, makes this our pick of 2018. We’re very excited about sharing this project with you. If you’d like some more specific project information, please get in contact with the Blue Wealth team.
