First Quarter │2013

MILDURA AREA

Property Watch®

MILDURA AREA MARKET OVERVIEW

The following investigation looks at the Mildura Area residential real estate market, which includes the suburbs Mildura, , Red Cliffs, Irymple, Ouyen, , Murrayville, and Hattah to form the Mildura Rural City (LGA).

The Mildura Area house market has recorded a total of 266 settled transactions during the October 2012 half year period, to uphold three consecutive periods of positive growth representing a marked increase of 11.7 per cent in sales volume since the March 2011 period.

A price point analysis undertaken for the Mildura Area house market has indicated no dramatic trends, however did note an increase in the sale of homes between the $100,000- $199,999 price range (9 per cent increase from October 2011) explaining the current decrease in median price likely to continue in the short term as buyers maintain appetite for well-priced entry level property and target heavy price discounts from the higher end. The absorption of the Mildura Area housing stock should continue into 2013 as buyers indicate increased activity spurred by successive interest rate cuts and the Victorian government’s stamp duty discount being increased to 30 per cent (from 20 per cent) as of January 1, 2013. These incentives will provide the Mildura Area house market a solid base to see another positive shift in sales and median price toward the end of 2013.

MILDURA AREA HOUSE SALES CYCLE

450 $250,000 MARKET INDICATORS Number of sales Median 400 $212,000 Change from Last Year Half Year $200,000 350

HOUSE SALES 300 $150,000 250 HOUSE MEDIAN 200

$100,000 Number of salesof Number HOUSE RENTS 150 price sale Median 100 UNIT SALES $50,000 50

UNIT MEDIAN 0 $0

2003 APR 2003 APR 2004 APR 2005 APR 2006 APR 2007 APR 2008 APR 2009 APR 2010 APR 2011 APR 2012

2003 OCT 2003 OCT 2004 OCT 2005 OCT 2006 OCT 2007 OCT 2008 OCT 2009 OCT 2010 OCT 2011 OCT 2012 UNIT RENTS OCT 2002 Half year period Prepared by PRDnationwide Research. Source: PDS LAND SALES The Mildura Area vacant land market transaction numbers have fluctuated significantly in LAND MEDIAN the past five years due to the inconsistency of total sales figures and continuing interest to expand the Mildura area via subdivision & Greenfield development. Having said this, the median price in Mildura Area for vacant land has remained steady since 2006, peaking The indicators depicted above are based on the year again in October 2012 at $85,000. The current trend toward smaller and more affordable ending October 2012, except for rental indicators housing has led to a flattening in median price, however with added incentives for home which reflect quarterly data up to June 2012. buyers and a strengthening environment for developers and buyers alike will see the Mildura Area increase again in vacant land sales into 2013.

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HOUSE PRICE POINTS MILDURA AREA VACANT LAND SALES CYCLE

2010 OCT 2011 APR 2011 OCT 2012 APR 2012 OCT 250 $90,000 At least Number of sales 3% 2% 6% 4% 5% $85,000 $400,000 Median $80,000 $350,000 to 5% 6% 5% 7% 3% $399,999 200 $70,000 $300,000 to 7% 10% 8% 11% 7% $349,999 $60,000 $250,000 to 19% 19% 17% 17% 16% $299,999 150 $50,000

Pricepoint $200,000 to 25% 29% 26% 29% 26% $249,999 $40,000 $150,000 to 100 27% 23% 27% 22% 28% $199,999

$30,000

Number of salesof Number Median sale price sale Median $100,000 to 10% 10% 10% 10% 12% $149,999 $20,000 50 Less than 4% 2% 1% 3% $100,000 $10,000 0% 20% 40% 60% 80% 100% Proportion of total sales 0 $0 Prepared by PRDnationwide Research. Source: PDS

2003 APR 2003 APR 2004 APR 2005 APR 2006 APR 2007 APR 2008 APR 2009 APR 2010 APR 2011 APR 2012

2003 OCT 2003 2004OCT 2005OCT 2006OCT 2007OCT 2008OCT 2009OCT 2010OCT 2011OCT 2012OCT 2002OCT MEDIAN RENTS – 3500 PC Half year period

Prepared by PRDnationwide Research. Source: PDS 2010 JUN 2011 JUN 2012 JUN $130 Observation of the Mildura Area unit Price Point chart over the October 2012 period has Flat (1 Bed) $125 seen a marked increase in the proportion of sales between $100,000-140,000, accounting $135 for 17 per cent increase in sales since April 2012. There has also been a contraction in $160 Flat (2 Bed) $165 purchasing activity in the $140,000-180,000 market (showing a 19 per cent decrease of $175 total sales) which together has led to an acute correction in the median price back to $220 $137,757. The Mildura Area may now see some shift on the back of strengthening unit Flat (3 Bed) $220 rental market and strong shift towards a more affordable product; this will lead to an $235 increase in gross rental yield in turn increase investment into the Mildura Area unit market. $190 .

House (2 Bed) $190 Dwelling type Dwelling $205 MILDURA AREA UNIT SALES CYCLE $225 House (3 Bed) $235 140 $200,000 $250 Number of sales Median $200 $180,000 House (4 Bed) $210 120 $220 $160,000

$0 100

$50 $140,000

$100 $150 $200 $250 $300 $137,757 Median rent $120,000 80 Prepared by PRDnationwide Research. Source: RTA $100,000

60

$80,000

Number of salesof Number Median sale price sale Median MILDURA UNIT PRICE POINTS 40 $60,000

$40,000 2010 OCT 2011 APR 2011 OCT 2012 APR 2012 OCT 20 At least 15% 23% 15% 19% 27% $20,000 $220,000

$200,000 to 0 $0 17% 13% 21% 6% 7% $219,999

$180,000 to 11% 6% 9% 2% 7%

$199,999

2003 APR2003 2004APR 2005APR 2006APR 2007APR 2008APR 2009APR 2010APR 2011APR 2012APR

2009 OCT 2009 2002 OCT 2002 OCT 2003 OCT 2004 OCT 2005 OCT 2006 OCT 2007 OCT 2008 OCT 2010 OCT 2011 OCT 2012

$160,000 to Half year period 4% 10% 9% 10% 4% $179,999

Pricepoint $140,000 to Prepared by PRDnationwide Research. Source: PDS 19% 13% 15% 17% 4% $159,999 $120,000 to 13% 19% 15% 17% 27% $139,999 The Mildura Area rental market has performed consistently since June 2010 with median

$100,000 to rents in the house and unit markets increasing on average by 9 & 6.5 per cent respectively. 13% 13% 3% 15% 22% $119,999 Citing this evidence along with the Mildura Area’s vacancy rate (currently at 1 per cent) and Less than 9% 3% 15% 15% 2% $100,000 investment yields strengthening in house and unit markets, buyers and investors alike will

0% 20% 40% 60% 80% 100% become increasingly attracted to the capital growth which is predicted to be seen in the Proportion of total sales Mildura Area in 2013.

Prepared by PRDnationwide Research. Source: PDS

Research Analyst │Angus McLean P (07) 3026 3357 F (07) 3166 0457 E [email protected] PRDnationwide Mildura │ P (03) 5022 7750 F (03) 5022 2254 E [email protected]

Prepared by PRDnationwide Research. Source: PDS, Residential Tenancy Authority. PRDnationwide does not give any warranty in relation to the accuracy of the information contained in this report. If you intend to rely upon the information contained herein, you must take note that the information, figures and projections have been provided by various sources and have not been verified by us. We have no belief one way or the other in relation to the accuracy of such information, figures and projections. PRDnationwide will not be liable for any loss or damage resulting from any statement, figure, calculation or any other information that you rely upon that is contained in the material. Prepared by PRDnationwide Research © All medians and volumes are calculated by PRDnationwide Research. Use with written permission only. All other responsibilities disclaimed. © 2013