When looking at the South East bay side area of Melbourne, we can observe a big difference in prices from one suburb to another. Frankston represents the most affordable suburb in the S.E bay side area, making it appealing for a lot of first home buyers.
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Why are Frankston's prices lower than other suburbs?
It is difficult to compare Frankston to its neighbouring suburbs, as it is not just a bayside suburb like Chelsea, Carrum or Seaford nor a beach town like Mount Eliza or Mornington.
There is a natural trend of prices dropping as suburbs are located further from Melbourne City. There is a big difference in price from Frankston to Mount Eliza as they are very different propositions, zonings, facilities, demographics, landscape.
Frankston is a city itself with its own CBD. As with any other city, it becomes a meeting point for people from many social backgrounds and these differences become even more evident in a small city.
There is a stigma that Frankston is dangerous, but data tell us something different.
Another aspect talked about is the crime rate in Frankston. Looking at the 2020 ‘Crime by Location Map’ below, we can observe that Frankston’s crime rate is comparable to other suburbs of Melbourne. In fact there are as many criminal incidents in some prestigious inner suburbs of Melbourne as there are in Frankston.
Is Frankston a good investment?
Regarding property investment, Frankston’s position remains unclear.
Although the entry price is lower compared to the surrounding suburbs, the rent doesn’t provide enough cash flow to be a positively geared suburb. This leaves the positive cash flow investors out of the game.
As for capital growth, it doesn’t perform as well as other suburbs in Victoria. When comparing with Geelong, we can observe the difference in capital growth behaviours during the 2018/2019 correction (as below). Frankston was quicker to drop and slower to recover, meaning that properties take more time to grow in value rather than the quick returns that may occur in other suburbs. Even though it is not a high performing suburb it performed well in the last 5 years, with a growth average of 8% per year.
Frankston Growth in the last 10 years
Geelong growth in the last 10 years
Should we buy our home in Frankston?
The Frankston property market has its own unique dynamic, which contains different pockets and properties that perform very differently to each other. Understanding those pockets and how they perform becomes crucial in buying the right property.
If you feel unsure about buying your home in Frankston and you would like to know more about the area, get in touch with us. We are a local buyer’s agency based in Frankston, that helps home buyers secure the right property for their family.