blog.buysellrealestate.com.au

It had to happen. As I predicted a couple of weeks ago (property-prices/”>“Rising fuel price could impact on property prices”), properties in home-sales-dip-20km-from-city-20080725-3l3h.html” target=”_self”>Melbourne’s outer suburbs are dropping whilst those close to the city are moving up.

For the entire Melbourne metropolitan area, median house prices rose 4.9% for the June quarter, whereas homes further than 20km from the city, in suburbs like Scoresby and Hoppers Crossing, dipped 1.7%. It is thought that rising fuel prices could be to blame for the different performances. Properties on the outskirts are heavily reliant on car travel, and are therefore far more susceptible to the impact of rising petrol prices than homes closer to the city centre. Maybe property developers should follow the lead of Gold Coast developer Mark Chapman, who is giving away a Toyota Prius with blocks of land at Currumbin.

What we are seeing at present may just be a slight blip, and may go nowhere. Sometimes statistics will do that. On the other hand, it could be the start of something far more significant. I’m concerned that if petrol prices continue to rise, this divide between the inner and outer suburbs could develop a serious split economy, creating a kind of real estate caste system.

What do you think? Will petrol prices have a seriously negative effect on the outer suburbs?