Local Market Intelligence Residential Market Overview The Grove (Tarneit)

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January 2020 charterkc.com.au

ADVISORY. RESEARCH. VALUATIONS. PROJECTS.

The Story Metropolitan Melbourne: Key Considerations

INTRODUCTION Education Melbourne continues to emerge as a city of Liveability international significance. It was ranked as 2 Universities in the Top 100 the world’s most liveable city for seven consecutive years between 2011-2017 and Most Liveable Cities Global Universities was ranked second in 2018 and 2019. (University of Melbourne = 32nd (7 Consecutive Times, 2011-2017) There are highly regarded educational and Monash University = 84th) institutions in Melbourne, with two universities ranked in the top 100 global universities. Economic Activity Strong Employment Growth , the second-largest economy in , recorded strong growth (+3.0% +3.0 % +1.9% growth over FY 18/19) outperforming the +100,000 Jobs wider Australian economy (+1.9% over FY (Victorian Economic (Australian Economic 12 months to November 2019 (Trend) 18/19) Growth 2018-2019) Growth 2018-2019) Melbourne continues to evolve and create opportunities not available elsewhere in Australia.

DEMAND CONSIDERATIONS Victoria Population Growth Victoria is the fastest-growing state in Recent Future Population Growth Australia and has recorded the highest 2018 (2016-2051) population growth rate since Q3-2015. The 139,450 New Residents majority of this growth has occurred within +2.2% 1.5% p.a. (86,000 – Overseas Migration, 13,200 - Net Interstate metropolitan Melbourne. Strong population Migration, 40,250 - Natural Increase growth is anticipated to continue into the Australia = + 1.6% p.a. Australia = + 1.6% p.a. future. Victoria in Future 2019 projections forecast that between the 2016 – 2051 period Future Housing Requirements Economic Opportunities metropolitan Melbourne will add an additional 1.57 million households. 1.57 Million Dwellings Diversity of Employment Melbourne is a multicultural city with large international migration underpinned by its Metropolitan Melbourne’s (Not reliant on a Single Industry education institutions and diverse Requirements 2016 - 2051 of Employment) economic base. The diversity of population and strong economic base underpins diversity in housing requirements across Melbourne.

SUPPLY CONSIDERATIONS Existing Housing Composition Composition of Future Housing Supply Melbourne’s housing stock is predominantly represented by detached housing, however, policy aspirations aim to achieve greater levels of higher density 15% : 17% : 68% 31% : 36% : 34% dwellings to accommodate future (Higher Density) :(Medium Density) :(Detached Houses) (Higher Density) :(Medium Density):(Detached Houses) population growth. (2016) (2011 -2051) House price growth in Melbourne has been high over the last decade and supported House Price Growth the development of higher-density stock. Greenfield Lot Sales House prices moderated through 2018 (5 Year Annual Average) (10 Year Annual Average) before increasing again over 2019. 13,000 Annual Lot Sales Melbourne continues to remain the leading +4.2% p.a. +5.4% p.a. Australia (weighted capital Australia (weighted capital supplier of new greenfield lots across city average) = +1.6% p.a. city average) = +3.8% p.a. (2014 - 2018) Australia with an average of 13,000 lot sales recorded per annum over the 2014 – 2018 period. 1 As at the 2016 Census. Additionally, apartments are dwellings in buildings with 4 or more levels. *Refer to end of report for all sources used in compiling this report.

Local Market Intelligence

The Grove (Tarneit)

KEY CONSIDERATIONS MARKET INDICATORS DEMAND INDICATORS SUPPLY INDICATORS AFFORDABILITY: Tarneit offers 25 – 44 year olds 500 Lot Sales an affordable alternative when $550,000 compared to the broader Tarneit 2019 median house price The predominant age cohort Limited lot sales across 2018 metropolitan Melbourne region. (Metro Melbourne = $690,000). across Tarneit accounting for (2,000 sales in 2017) 40% of all residents. +12.3% p.a. PROXIMITY TO THE CBD: 28 km Couples with Children Detached Housing Tarneit 10 year average annual from the CBD, Tarneit is closer Largest household type across 80% of dwellings in Tarneit are house price growth to the Melbourne CBD than most Tarneit accounting for 58% of all detached houses (Metro Melbourne = 5.8% p.a.). other greenfield locations. households. (Metro Melbourne = 68%) $560,000 30 Years: Median Age AMENITY: Tarneit possesses a Owner Occupiers Wyndham LGA 2019 median Younger age demographic than higher level of amenity than 71% of houses are owned outright house price metropolitan Melbourne. other greenfield locations due to or owned subject to a mortgage. the presence of a railway station (See page 2 for more info.) (Metro Melbourne = 36 years.). (See page 4 for more info.) and multiple shopping centres . (See page 3 for more info.)

LIVEABILITY AND LIFESTYLE CONNECTIVITY SUBURB CONTEXT & FUNDAMENTALS Numerous watercourses run 28km west of the Melbourne » Tarneit is a suburb within the City through the suburb including; CBD. of Wyndham Local Government , Skeleton Creek, Direct connectivity to the CBD, Area (LGA), located approximately Tarneit Creek and Davis Creek. via Sayers and Leakes Roads 28km west of the Melbourne CBD. Numerous parks are located which connect to the Princes throughout the suburb’s many Freeway. » Significant residential housing developments. The development in Tarneit first Werribee Mansion and the Proximity to the Melbourne CBD began in the mid 2000s prior to , are and Laverton North Industrial precinct. that the area was an undeveloped both within close proximity. Tarneit Station provides a direct rural locality mostly comprising Tarneit Central Shopping Centre connection to both the Melbourne farmland. is situated in the heart of the CBD and via a Vline suburb, anchoring major retailers. service, additional rail » The suburb is bounded by Other shopping centres include connectivity to the CBD is Truganina to the east, Hoppers Wyndham Village SC, Tarneit provided via metro services from Crossing and Werribee to the Gardens SC, and Tarneit West SC. Hoppers Crossing and Werribee Pacific Werribee in Hoppers south and to the Stations. Numerous bus routes Crossing is the nearest super- west. run through the suburb, providing regional shopping centre a connection to the train stations, containing most major retailers. » Tarneit is predominantly a and key shopping precincts. residential suburb, with small Tarneit has numerous Primary & pockets of retail activity located provides access Secondary schools. Victoria to the Inner West and Melbourne throughout. The western and University’s Werribee Campus is CBD. and northern portions of the suburb also in close proximity. are also are presently undeveloped but popular. Werribee Mercy & St. Vincent will support additional housing Approximately 30 minutes drive Private Hospitals anchor over the coming years. to both Melbourne Airport and Wyndham’s major medical Avalon Airport via Princes » precinct located in the nearby Freeway and Western Ring suburb of Werribee. Road.

Market Considerations 2

PRICE INDICATORS MEDIAN HOUSE PRICE & AVERAGE ANNUAL % CHANGE – TARNEIT (1995 - 2019) The 2019 median house price in Tarneit was $550,000, which is lower than that of both metropolitan Melbourne ($690,000) and the Wyndham LGA ($560,000). Since its establishment as a residential suburb, Tarneit has experienced stronger housing price growth than both the Wyndham LGA and metropolitan Melbourne with prices increasing by 12.3% p.a. since 2009. Recent housing price growth across both Tarneit and the Wyndham LGA has significantly outpaced that of metropolitan Melbourne.

Tarneit is a highly sought after location within the Wyndham LGA evidenced by its strong recent price *These are the figures from APM and reflect the transacted and settled sales recorded by APM. growth. Historically housing prices in Tarneit have mirrored those of the Wyndham LGA .

PRICE RELATIVITY 2019 MEDIAN HOUSE PRICE (ALL BEDROOMS) – TARNEIT & SURROUNDING SUBURBS In comparison to other surrounding suburbs in the Wyndham LGA, Tarneit with a 2019 median of $550,000 contains a higher median house price than the older more established Wyndham suburbs of Hoppers Crossing ($520,000) and Werribee ($505,000).

Tarneit has greater established infrastructure than the other greenfield markets in the region through the provision of shopping centres and a railway station. Tarneit’s strong amenity will continue to drive demand into the future with housing price growth likely to remain strong.

RENT AL MARKET INDICATORS MEDIAN WEEKLY RENTS & AVERAGE ANNUAL % CHANGE (HOUSES - 3 BEDROOMS)* At the end of Q2-2019, median weekly rents for a 3 bedroom house in the Werribee – Hoppers Crossing district ($350 p.w.) were less than the metropolitan Melbourne equivalent ($400 p.w.).* Rental price growth across the Werribee – Hoppers Crossing district has outpaced that of metropolitan Melbourne over the last 3,5, and 10 years.

Despite the low weekly median rent, the Werribee – Hoppers Crossing district is experiencing high rental growth in comparison to metropolitan

Melbourne, indicating demand for *These rents are taken from the Department of Human Services (DHS) and are based on the DHS geographies. The DHS rental properties in the area. does not separately classify Tarneit in its data and so the district of ‘Werribee – Hoppers Crossing’ which includes Tarneit and surrounding suburbs has been used as a proxy for market rents.

Local Market Intelligence The Grove (Tarneit)

Demand Considerations 3

POPULATION INDICATORS POPULATION GROWTH – HOPPERS CROSSING – TRUGANINA VIFSA (2018-2036) Based on the Victoria in Future (VIF) 2019 projections, the population of the Hoppers Crossing – Truganina VIFSA* is forecast to grow from 120,000 in 2018 to 210,000 by 2036. Population growth in the Hoppers Crossing – Truganina VIFSA is forecast to be greatest across the 2021-2026 period (+26,200 residents) with the average annual growth over the 2018 – 2036 period forecast to be +3.2% p.a.

Tarneit’s location in one of Melbourne’s growth corridors will see the population grow significantly VIFSA*Refers to Victoria in Future Small Areas. Tarneit forms part of the Hoppers Crossing – Truganina VIFSA over the short term. The abundance of undeveloped residential land in Tarneit is sufficient to accommodate the forecast p opulation growth .

DEMOGRAPHIC INDICATORS DEMOGRAPHIC DRIVERS OF DEMAND, TARNEIT (2016) The 25-44 years (40%) age cohort makes up the largest segment of % OF POPULATION PREDOMINANT Tarneit’s population, whilst the 25 - 44 YEARS OLD HOUSEHOLD TYPE predominant household type is SOURCE - ABS (2016) SOURCE - ABS (2016) Couples with Children (58%). Couples with Children Tarneit Metro Melbourne The median age of Tarneit residents Tarneit Metro Melbourne is 30 years, significantly below that of metropolitan Melbourne. A 40% 31% 58% 35% majority (55%) of Tarneit’s residents were born overseas with 21% of residents born in India. MEDIAN AGE TOP 3 COUNTRIES SOURCE - ABS (2016) Tarneit is a diverse suburb with more OF BIRTH than half of all residents born (NON-AUSTRALIAN RESIDENTS, % OF POPULATION) SOURCE - ABS (2016) overseas. Tarneit is home to many Tarneit Metro Melbourne young families as evidenced by its India , New Zealand & Total Born young median age and large Philippines Overseas proportion of family households. 30 Years 36 Years 31 % 55%

SOCIO -ECONOMIC INDICATORS SOCIO-ECONOMIC DRIVERS OF DEMAND, TARNEIT (2016) The primary occupation for residents in Tarneit in 2016 was Professionals PRIMARY INDUSTRY PRIMARY (18%) and the primary industry of OCCUPATION OF EMPLOYMENT SOURCE - ABS (2016) employment was Health Care & SOURCE - ABS (2016) Social Assistance (14%). Professionals Health Care & Social Assistance The median annual household Tarneit Metro Melbourne income of residents in Tarneit was Tarneit Metro Melbourne

$89,000 in 2016 which was 18 % 25 % 14 % 13 % significantly higher than the metropolitan Melbourne equivalent ($80,000). A greater proportion of Tarneit residents aged over 15 have a MEDIAN LEVEL OF

Bachelor Degree than the HOUSEHOLD INCOME EDUCATION metropolitan average. SOURCE - ABS (2016) SOURCE - ABS (2016)

Residents of Tarneit tend to be well Bachelor Degree or Higher Tarneit Metro Melbourne educated and employed in high Tarneit Metro Melbourne paying jobs across a diverse range of industries and occupations. $89,000 p.a. $80,000 p.a. 43 % 41 %

Local Market Intelligence The Grove (Tarneit)

Supply Considerations 4

DWELLING MIX DWELLING MIX, TARNEIT (2016)* Tarneit contains a high proportion of detached housing (80%) with only a limited number of townhouses (19%) and apartments (1%). Tarneit’s dwelling mix contains a significantly larger proportion of detached dwellings than metropolitan Melbourne (68%). Tarneit’s location in Melbourne’s western growth corridor makes it one of the leading providers of new detached dwellings in Victoria. The suburb has seen an increase in the proportion of townhouses with 19% of all dwellings being townhouses, a greater proportion in comparison to other greenfield *Units = flats, units and apartments. markets across metropolitan Medium Density = semi-detached, row, terrace or townhouses. Melbourne.

HOME OWNERSHIP HOME OWNERSHIP, TARNEIT (2016) Tarneit is a relatively new suburb making it a popular destination for first home buyers attracted by the area’s relative affordability. As a result, Tarneit contains a significant proportion of homes being purchased but only a small number of homes which are owned outright. In comparison to metropolitan Melbourne, a greater proportion of houses in Tarneit are currently being purchased or rented. Across Tarneit a significant proportion of houses (29%) are rented indicating significant demand from investors to purchase in the suburb. Across Tarneit the most likely purchasers of new housing are first home buyers followed by investors.

NEW SUPPLY – GREENFIELD LOT SALES GREENFIELD LOT SALES – TARNEIT (2013 – 2019)* Lot sales volumes across Tarneit grew year on year over the 2013–2017 period, increasing from just 400 sales in 2013 to 2,000 sales in 2017. Tarneit recorded 11 consecutive quarters of greater than 300 lot sales from Q2 2015 – Q4 2017. Lot sales volumes declined significantly across 2018 with just 500 sales recorded, down 75% on the previous year.

The decline in lot sales continued through the first half of 2019 before sales volumes began to increase in Q3 2019. The fall can be attributed to *Data was sourced from Pricefinder and includes settled lot sales only. Settlement lag on vacant land sales can be up to 2 broader market uncertainty through the years. 2018-2019 period with falling house prices observed throughout metropolitan Melbourne.

Local Market Intelligence The Grove (Tarneit) TARNEIT – LOT RE-SALES

Re-Sale Original Original Re-Sale Re-Sale Settlement Sale Area Address Estate Agent Sold Price Sale Date Price Date Date Type (sq.m.) 226 Hummingbird Boulevard Riversdale Raj Shah $283,000 07/12/2017 $347,000 02/01/2020 17/02/2020 Normal 448 Tarneit 13 Trentbridge Drive Newgate Sunny Shah $265,000 19/05/2017 $275,000 21/04/2020 15/05/2020 Normal 375 Tarneit 58 Lionsgate Crescent The Grove Gurpreet $249,000 08/04/2017 $300,000 03/03/2020 16/04/22 Normal 374 Tarneit Singh 24 Cinnamara Circuit Newgate Ricky Forte $279,000 17/06/2017 $295,000 29/01/2020 13/03/2020 Normal 400 Tarneit 26 Queensbridge Avenue Newgate Charles $245,000 03/07/2017 $247,000 26/03/2020 08/05/2020 Normal 293 Tarneit Ealdama 6 Clifton Circuit The Grove Richard $205,900 09/10/2015 $300,000 02/03/2020 30/04/2020 Normal 400 Tarneit Falzon 8 Blairmont Crescent Newgate Sunny Shah $309,000 13/08/2017 $315,000 13/03/2020 14/05/2020 Normal 420 Tarneit

Local Market Intelligence The Grove (Tarneit)

ADVISORY. RESEARCH. VALUATIONS. PROJECTS.

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This Report provides an independent and unbiased overview of the suburb Tarneit and has been carefully prepared by Charter Keck Cramer at the instruction of Frasers Property. This Report does not render financial or investment advice and neither Charter Keck Cramer nor any persons involved in its preparation accepts any form of liability for its contents. The information contained herein was compiled in January 2020 and should not be relied upon to replace professional advice on specific matters. Charter Keck Cramer is not providing advice about the suitability of investment in any specific project or financial product and is not a holder of an Australian Financial Services Licence. This report is Copyright and cannot be reproduced without written permission of Charter Keck Cramer. © 2020 Charter Keck Cramer Visit charterkc.com.au Sources: Charter Keck Cramer, Australian Bureau of Statistics, Forecast.id, Department of Human Services , APM, SQM Research, walkscore.com, Google maps, VIF 2019, City of Melbourne, Economist Intelligence Unit, Times Higher Education World University Rankings 2019, SGS Australian Cities Accounts 2015-16, Plan Melbourne 2014 and Plan Melbourne Refresh 2015.