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\u2018Fall\u2019: Man exposes Italy\u2019s brutal $2 home trap<\/a><\/p>\n The analysis classified suburbs as undervalued when house prices sat below similar surrounding markets despite no clear geographic disadvantage and local supply-and-demand conditions were showing signs of improvement.<\/p>\n But the label did not mean a suburb was cheap, guarantee future growth or suggest every individual home represented a six-figure saving.<\/p>\n At the other end of the scale, Parkville and Deepdene were each rated $250,000 above comparable nearby markets, followed by Armadale at $226,000, Black Rock at $225,000 and Caulfield at $222,000.<\/p>\n SuburbData also considered the gap between house and unit prices, previous capital growth and whether buyer demand was beginning to strengthen relative to the number of homes available.<\/p>\n SuburbData analyst Jeremy Sheppard said Melbourne arguably had more undervalued markets than Australia\u2019s other major capitals after years of weaker growth than Brisbane, Perth and Sydney.<\/p>\n Changes affecting property investors, increased housing construction and softer buyer demand had contributed to Melbourne\u2019s underperformance, although Mr Sheppard expected some of those pressures to diminish over time.<\/p>\n \u201cIt\u2019s not just compared to direct neighbours,\u201d Mr Sheppard said.<\/p>\n \u201cA lot of the other areas nearby have had more growth, or in some cases it\u2019s the undervalued suburb that had the decline.\u201d<\/p>\n He said identifying markets with strong growth potential had become more difficult as property conditions weakened.<\/p>\n \u201cDuring boom times, like in 2021, markets like that were easy to find,\u201d he said.<\/p>\n \u201cYou throw a dart on a board and hit one. Now you need to know where to look.\u201d<\/p>\n However, Mr Sheppard warned buyers entering markets rated as overvalued with small deposits could face negative equity if prices fell and their circumstances forced them to sell.<\/p>\n \u201cThe risk is that if you buy in a market like this, your home may sit there for a while without getting any return on your investment, or values may fall and you go into negative equity,\u201d he said.<\/p>\n \u201cThat may not be a problem if you plan to stay there 10 years, but you also never know when your circumstances change.\u201d<\/p>\n Matthews Agency director John Matthews said Maidstone, Niddrie and Ascot Vale gave buyers proximity to the CBD without the entry prices commanded by some of their better-known neighbours.<\/p>\n He said Ascot Vale attracted young professionals moving from North Melbourne, Flemington and Kensington in search of larger blocks while retaining an inner-city lifestyle.<\/p>\n The suburb offers Union Rd shops, train and tram services and is close to the Melbourne Showgrounds and Flemington Racecourse.<\/p>\n \u201cAscot Vale is really good value because the bigger money gets paid in Moonee Ponds and Essendon,\u201d Mr Matthews said.<\/p>\n He said families who could not afford Essendon were increasingly considering neighbouring Niddrie, where they could remain close to established private and government schools.<\/p>\n \u201cPeople can\u2019t quite afford to get into Essendon, but Niddrie is right next door and you can still get access to all the good schools,\u201d he said. <\/p>\n A $1.2m budget could still secure a standard three-bedroom house on a full block of about 650sq m in Niddrie, Mr Matthews said.<\/p>\n The same budget in Ascot Vale was more likely to buy a single-fronted home on a block of about 200-300sq m.<\/p>\n Mr Matthews said Maidstone was another compelling option for buyers and investors seeking proximity to central Melbourne on a tighter budget.<\/p>\n He said worsening congestion was also prompting homeowners from Greenvale, Caroline Springs and other outer suburbs to consider moving closer to the city.<\/p>\n Parley Property Advisory buyer\u2019s agent Luke Assigal said investors from Sydney and Brisbane were also beginning to recognise Melbourne\u2019s relative value.<\/p>\n \u201cCompared with the other states, Melbourne is definitely undervalued,\u201d Mr Assigal said.<\/p>\n \u201cMelbourne still has the population, employment opportunities and infrastructure. The question is why those fundamentals are not currently reflected in its property values.\u201d<\/p>\n But he warned buyers against assuming every affordable suburb beside an expensive market would inevitably catch up.<\/p>\n \u201cYou cannot simply assume that because one suburb is performing strongly, every adjoining postcode will follow it,\u201d he said.<\/p>\n Mr Assigal said the potential saving from crossing a suburb boundary depended on transport, amenity, demographics, housing stock and the quality of individual streets.<\/p>\n \u201cIn some cases, crossing into the neighbouring suburb might save a buyer $100,000,\u201d he said.<\/p>\n \u201cIn other cases, the difference might only be $20,000 or $30,000.\u201d<\/p>\n He pointed to Carnegie, rated $78,000 below surrounding markets, as an established suburb offering train access, a strong food culture and many of the lifestyle factors buyers sought in Malvern and Malvern East.<\/p>\n But he said buyers still needed to assess individual pockets, with homes beside major infrastructure potentially affected by noise, outlook or construction.<\/p>\n \u201cBuyers need to understand whether the suburb itself is essential or whether the lifestyle and amenity it offers can be found elsewhere,\u201d Mr Assigal said.<\/p>\n \u201cUnless someone has an unlimited budget, they cannot have everything. They need to decide whether the property or the location is critically important.\u201d<\/p>\n Sign up to the Herald Sun Weekly Real Estate Update. Click here <\/a>to get the latest Victorian property market news delivered direct to your inbox.<\/p>\n MORE: Photos expose secret Block bombshell move<\/a><\/p>\n Revealed: Block 2026 top secret plans<\/a><\/p>\n 695 Aussies trapped in $16.5m nightmare<\/a><\/p>\n david.bonaddio@news.com.au<\/p>\n Originally published as Melbourne: New research exposes massive $253k suburb price gap<\/a><\/p>\n<\/p>\n