Melbourne Bargain Suburbs for Every Budget in 2023

The Melbourne property market literally grind to a halt in the second half of 2022. Consecutive interest rates rises bumped mortgage interest rates from a low 2% to over 6% in 7 short months. This huge jump, caused borrowing capacity to shrink by as much as a third, and buyer's budgets for the property purchase shrank almost immediately. That, created a sudden shock to the property market.

The bullish buying, buyers' fear of missing out (FOMO), high 90+% auction clearance rates in the first half of 2022 quickly gave way to a bearishly low 50% auction clearance rates, and an almost immediate end to bidding frenzy at open auctions. Buyers now fear catching a falling knife, and are a lot more cautious, and careful with their property budget. Afterall, it is only natural that people stay away from buying and spending, when the interest rates direction is unclear, and there doesn't seem to be an end to the ever rising interest rates.

With such a slow market, bargains are starting to appear. In fact, in some of the suburbs below, bargains appeared almost as soon as interest rates start rising. Most of these suburbs are typically the first home buyers buying heaven. And as first home buyers, they are usually the most sensitive to mortgage interest rates rises and monthly repayments increased.

Top Melbourne Bargain Suburbs in 2023

As we head into 2023, our team of buyers advocates have put together this article, listing a few suburbs where bargains have consistently appear. We have also categorised these bargain suburbs into 3 main categories, according to the typical median price and buyers' budget.

1. First Home Buyer Budget - median price up to $750k

2. Middle Income Budget - median between $750k and $1.8M

3. Higher Income Budget - median over $1.5M

These suburbs are selected based on the level of discounting. I.E., the difference between Sold Price and List Price. Buyers of these suburbs can usually buy properties for at least 5% discounts. And, in some cases, almost 10%. Bear in mind though, you need to assess each property individually. Not all properties in these suburbs are being discounted. Location and condition are still the Kings and Queens of property pricing. Properties in good locations, near good schools, good amenities, good transport access, always enjoy a premium. And needless to say, buyers are definitely more willing to pay a premium for properties top-notch condition and high quality fittings.

So, let's start with the list:

Top 3 First Home Budget Bargain Suburbs in 2023

Properties in these areas quality for the First Home Owners Grant (FHOG). In no particular order, the top 3 suburbs in within reach of First Home Buyers are:

1. Derrimut ~5% discount

2. Croydon ~5% discount

3. Glenroy ~5% discount

Top 3 Middle Income Budget Bargain Suburbs in 2023

Properties in the middle income budget areas are typically priced between $1M to $1.8M. Again, in no particular order, the top 3 suburbs in the Middle Income Budget are:

1. Brunswick ~10% discount

2. Northcote ~8% discount

3. Burwood East ~7% discount

Top 3 Higher Income Budget Bargain Suburbs in 2023

These are the higher income bracket, and properties in these areas are typically over $1.8M. Again, in no particular order, the top 3 suburbs in the Higher Income Budget are:

1. Carlton North ~5% discount

2. Clifton Hill ~9% discount

3. Northcote (4 bedrooms and above) ~8% discount

Important Melbourne Property Buying Tips

Other than simply looking for suburbs with the best discount, buyers should also consider their needs and budget criteria. Read our complete Melbourne property buying guide, for more details.

Conclusion

So, here you are, the top 3 suburbs to pick up a bargain, based on your budget. As discussed above, you need to assess each property individually. Location and condition are still the Kings and Queens of property pricing. Properties in good locations, always enjoy a premium, compared to others in lesser locations within the suburb. And properties with high-quality fittings and in top-notch condition, will always attract more buyers' interest and thus, more buying competition. Be prepared to increase your budget if you are after good properties in prime locations.

If you need help assessing the value of a property or to get more information, get in touch with one of our friendly Buyers Advocates. We have services to help buyers assess the value of a property and/or to help buyers get the best price for the property and make the purchase confidently. To understand how property buying clients can and have benefitted from our services, read this. OR simply get in touch.

Contact us