Just south of the CBD on the shores of Port Phillip Bay lies Port Melbourne. An aspirational, upmarket, and trendy suburb close to everything. Port Melbourne in past times was considered a more industrial suburb, close to Docklands and the shipyards. Today it is a mixed, trendy residential and industrial suburb full of many upmarket dwellings.
Port Melbourne is an important transport heartland of Melbourne, interconnected by the freeways leading to the East & West of the city.
With land at a premium, Port Melbourne is consistently one of the most in demand suburbs in Victoria and Australia by local Victorian, Interstate & International buyers.
Lifestyle
Famous for its proximity to the water, CBD & space, Port Melbourne is full of activities. JL Murphy Reserve hosts many sporting events such as AFL, Rugby, Soccer & Cricket. There are many smaller reserves such as Letts, Julier & Beacon Vista which all create a nice open atmosphere to the suburb.
For pet lovers, Port Melbourne Dog Beach is one of the few beaches close to the CBD where pets are allowed off leash.
Many locals also enjoy the close proximity to the MCG & Docklands to see sporting events, only a short tram or bus ride away and also the outdoor water activities such as sailing by Princes Pier or kitesurfing on Port Melbourne Beach.
There are many gyms & health clubs within the suburb particularly towards the intersection of Bay Street & Beach Street.
School Zones
Port Melbourne is a great location for school zones, it is within 5-10 minutes of some of the best public, private and specialist schools in Melbourne.
As an upmarket suburb, many wealth professionals send their children to Private Schools such as Melbourne Grammar School, Melbourne Girls Grammar & St Catherines that lie nearby.
For Primary Schools, depending where you sit on the eastern or western side, Port Melbourne is within the zone of both Port Melbourne Primary School & Albert Park Primary School.
For Secondary Education, it is zoned within the well acclaimed Albert Park College.
For children with special needs, Port Phillip Specialist School also lies within the suburb.
Demographics
Long ago, being close to Docklands and the wharfs, Port Melbourne was a working class suburb. Much of the existing infrastructure has been there for over 100 years and was used to house the workers in the smaller attached & detached Victorian and miners cottages.
Now Port Melbourne has greatly gentrified and is home to many professionals and business owners. Accordingly, the weekly average household income has increased steadily from $1646 to $2372 between 2006 & 2021, well above the average income per household in Melbourne.
Port Melbourne is seen as an aspirational suburb of Melbourne, with many wealthy migrants moving here to both study and work. Many of the older dwellings are owned completely outright or with very small mortgages. Many suburb records have been broken in recent years, particularly towards Bay & Beach Street on Port Phillip Bay.
Employment
Professional Services are the largest employers of residents in Port Melbourne, many work within IT, Banking, Accounting & Hospitals.
Many of the younger people and migrants work within the Cafes and Restaurants that are abundant amongst the suburbs.
Large companies are finding many of the older warehouses in the western side of the suburb as a great location to base operations, meaning many residents have a commute of less than 5 minutes to work.
Transport
Port Melbourne is a unique suburb of Melbourne in terms of transport. It is situated only 3km away from Southern Cross Station, meaning a simple tram ride into Melbourne gets you an express train all over the state. Also being a main stop for many bus lines, Port Melbourne is a great location for bus routes. Many buses go to the outer east and bayside, some over the West Gate Bridge.
Port Melbourne is one of the few suburbs in Melbourne that have Ferry transport, with regular ferry’s to St Kilda & Williamstown. Water taxis also take residents to Richmond, Maribyrnong & Williamstown.
Shopping Centre's, Restaurants & Facilities
Port Melbourne benefits greatly with facilities, being so close the City & Bay.
Hospitals, specialist care, aged care and community facilities all lie within 3km of the suburb, many even closer. JL Murphy is the main sporting facility of Port Melbourne, but world class facilities only lie within the MCG District and Inner South, meaning they are all within 10 minutes commute.
Some of the best shopping districts in the country also lie in close proximity to Port Melbourne. Waterfront City, Southern Cross, South Wharf & South Melbourne all lie within 2-4 km away.
Restaurants, cafes and pubs line Bay Street, towards Royal Port Melbourne Yacht club. There are many smaller local cafes that lie within the suburb particularly towards the tram line.
Development
With land being particularly scarce, Port Melbourne is one of the most difficult suburbs to find developable land in. However, where land is found, whether than be residential, mixed use or industrial – it is often developed to a very high quality.
Density is higher towards the bay, tram line and bay street, with much of the single dwellings on land being amongst the quieter pockets of the suburb, close to the smaller parks.
Much of Port Melbourne has density limits, meaning there are significant restrictions to high rise developments.
Many homeowners are long term residents of the suburb and can be seem renovating the interior and exterior of their dwellings to ensure a local house proud feel in their neighbourhood.
Capital Growth
Port Melbourne is consistently one of the most in demand suburbs nationally and internationally in Melbourne, there is no surprise that the suburb has averaged over 9% capital growth decade after decade.
Scarcity of stock and excess demand from a wealthy demographic is the largest contributor to this. For houses, some streets of Port Melbourne have done over 11% capital growth in the past 20 years, while others have done a more modest but sufficient 7%. Some parts of the suburb are considered top 10 performers nationwide.
Port Melbourne is one of the few suburbs where units actually perform fairly well. In aspirational pockets of the suburb, such as towards Beach Street, units may perform as well as 8% capital growth, with other sections performing at around 6%. For international buyers, this is an extremely attractive proposal.
Cash Flow
As the suburb has become increasing in demand, Port Melbourne averages around 2.2-2.8% yield for houses. Below average, but largely due to the high prices attributed to aspirational suburb with higher capital growth.
Units, generally average between the 4-5% yield mark, though are often tenanted by childless professionals who want the right lifestyle close to the CBD.
Rental Demand
Due to no land available, demand for houses is some of the best in Melbourne. Often a higher level of fixtures and fittings creates a higher yield, as does the ability to walk to nearby transport, cafes, and restaurants within the suburb.
Often the vacancy rate ranges between 0.8-1.5%, meaning there is an unbelievable shortage of dwellings consistently. This has lead to regular average rental increases between 2.5-4% within Port Melbourne.
Units also perform quite well, with vacancy rates between 1-4%. This is largely due to the proximity to the CBD and large concentration of overseas working migrants and wealthier students that reside in the suburb.
Alike to houses, units generally have rental increases between 2.5-4% on average per annum, largely due to a restricted supply.
Why You Require a Buyers Agent in Port Melbourne
Port Melbourne is one of the most aspirational suburbs in Melbourne, hence homeowners find it difficult to upgrade from here. This in turn means, there is limited stock on the market, and many who aspire to live here who are wealthy.
For purchasers, this means that once the right property comes to market, it is met with excess demand by the right demographic and prices move up.
Critically, within Port Melbourne, much of the best stock is sold exclusively off market due to the exclusivity and price points of the suburb. Having access to these properties is near impossible without the right strategy or contacts.
With a high demand, inexperienced and unknowing homebuyers or investors are likely to pay above market rates; many homes go for up to 20% above reserve due to this demand.
Finally, having a representative who understands the suburb is only going to improve your financial situation. Purchasing in a more modest pocket of the suburb may only return you 7%, but in a better pocket return you 11%. Over the course of 10 years, this may increase your capital growth by 100%.
In a suburb as such, this may mean $1,000,000 more, with rental increases also inversely increasing with price increases. This is an example of how generational wealth is created.
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