$2 million mark in sight for Heads house price

Barwon Heads could soon become the region’s first $2 million suburb and compete with Mornington hotspots as the hottest real estate in regional Victoria.

Latest house price data indicates the town is rapidly approaching the milestone and has so far remained largely insulated from impacts such as rising interest rates that are applying the brakes on market activity in other areas.

Local real estate figures say the region’s perfect storm of growth factors will continue upward pressure on house prices and see the suburb shortly reach heights seen in traditional market leaders such as Portsea and Sorrento.

Property researcher Domain found in its latest House Price Report that Barwon Heads’ median price had reached $1.81 million to the end of the June quarter.

The figure was up about 6 per cent from the March quarter, 26.4 per cent from a year earlier, and 91 per cent over a five-year period.

Bellarine Property managing director Christian Bartley said he expected the $2 million ceiling to be within reach “in the next six months”.

“It’s not a matter of if it gets there, it’s a matter of when,” Mr Bartley said.

“There’s a limited amount of supply, and supply and demand is everything.

“(The town) is bounded by ocean and river, and rural land that’s contained from being developed.

“It’s the perfect real estate environment and perfect landscape for high capital growth.”

Barwon Heads’ strong performance contrasts other housing markets that started to feel the pinch of market volatility caused by factors including rising interest rates and construction costs.

The same Domain report indicated Melbourne dropped 0.7 per cent of its property value in the past quarter, while the national rate was also relatively stable at 0.6 per cent growth.

While Mr Bartley acknowledged that the Heads was not immune from a downturn in slow market conditions, he pointed to its relative strong performance during previous slumps as proof the town could weather any upcoming storms.

“I was running this business in 2008, when the Global Financial Crisis hit. We survived through that, and Barwon Heads had very little effect.

“Everything can stop and decline, and Barwon Heads is not resistant to that not happening… but when it then rises again, it will exceed everywhere else.

“It’s a more desirable location to be living. It’s always going to have that, it’s always going to have that limited supply, and it’s always going to have that lifestyle.”