VIC Real life capital growth comparisons over 30 years

Hi all. I was doing a few real life capital growth comparisons to see how 'far superior' the growth of a blue chip like Carlton would be over an 'end of the train' line suburb like Belgrave.

Once again, no real difference in performance over approx. 30 years. Yes, there was a reno, but don't forget the Belgrave house would have had higher rental yield the entire period.

Example 1 - 91 Kaola St, Belgrave, Vic
https://www.realestate.com.au/property/91-kaola-st-belgrave-vic-3160
7.76% growth over 32 years (1986 to 2017)
Note - property has been reno'd

Example 2 - 10 Charles Street, Carlton, Vic
https://www.realestate.com.au/prope...ep-pdp|sold-pdp:property-history-cta#timeline
7.47% growth over 27 years (1991 to 2018)


Does anyone have any similar data to share?

 

I've done a few more Belgrave/Upwey ones and they all work out about the same

13 Effie Ave, Upwey
https://www.realestate.com.au/property/13-effie-ave-upwey-vic-3158
7.31% capital growth over 33 years (1985 to 2018)

FYI according to SQM Carlton North has about 0.5 to 1% less rental yield than Upwey (3.5% vs 4.5%).

 

FYI my online Capital growth calculator - CAGR Calculator and Formula

 

What happened between 86 & 91 for Melbourne was there a boom in that period which has helped propped it up (as you are not comparing both 30 years)... I understand it is difficult to find with that far historic data.

From - https://www.mutilatethemortgage.com/wp-content/uploads/2012/05/Median-vs-Wage.jpg



So technically it boomed and dropped off in those couple of years, where as the 91 property was bought in a declining market. So the sample provided is not an accurate way to use as an example.

It would appear there was a boom

RE: more yield - yes more yield for Belgrave when it started however eventually the $$$ becomes more for the growth

 

OK sure (I agree). I'll hunt for some more examples.

Obviously we also have periods where inner vs outer are doing different things - i.e. like right now, inner is flat/decline, outer is still booming.

 

It is pretty hard to compare since two different suburbs inner vs outer will boom and burst at different times. There may be a couple of years between so even if you compare them for the same period (e.g. 1988-2018), it is still not accurate.

 

I think once a suburb is 'blue chip' it probably wont outperform in terms of capital growth. Its more about finding the next area to become desirable to get the really good growth
I would say that certain bayside suburbs which wernt always that highly regarded - sandringham,hampton, highett, beaumaris , black rock would have growth figures approximately double what you have found in belgrave / carlton for the last 30 odd years.

house I grew up in was 75k in 1983 and sold for 1.24 in 2014 - PRE BOOM and would sell easily for 1.7 -1.9
so what's the 30 odd year growth on that? (had a couple o f beers so no compounding calculations for me tonight...)

Interestingly though its probably only gone up 40% in the last boom where as many rough outer suburbs have gone up 100%
get my drift?

 

I don’t think you can fairly compare a “lifestyle area” growth rate during this boom with classic “blue chip” (which I agree has dropped off in growth) by plucking examples out of the air.

Plenty of homes in camberwell, hawthorn, glen iris and even ashburton (which was known for haveing a substantial housing commission area not so long ago) have increased over 200% over the period you are referring to. But those same properties were at at a similar price point to a Carlton townhouse at the time. ‍♀️

Honestly if you want to take a historical view, in hindsight you would be better off buying a few hectares in rockbank/pakenham/cranbourne etc than a toorak mansion...