Investing in Residential Developments: A Guide for Homebuyers in 2025
The path to homeownership hasn't exactly been a walk in the park lately. Between skyrocketing living costs, the struggle to save for deposits while juggling rent payments, and fierce competition for limited housing stock, many would-be investors have been left watching from the sidelines. But the tide is turning, particularly in key markets like Victoria.
As a custom home builder in Western Melbourne, we know that this state is emerging as a standout opportunity for savvy buyers. Once considered prohibitively expensive, it's now on track to become Australia's third most affordable capital city. Only Perth, Hobart, and Darwin currently offer lower median prices.
What's driving this shift?
A combination of factors, including declining house prices in certain areas and concerted government efforts to increase housing supply. The Victorian government's commitment to building more homes is helping to ease market pressure and create new entry points for buyers.
Smart investors are increasingly looking toward growth corridors, where infrastructure development and population growth are creating pockets of opportunity. Take Kalkallo, for example – a relatively new suburb just 31km north of Melbourne's CBD that saw over 6,000 transactions in 2024 alone. With a median house price of $630,000 (well below Melbourne's typical $895,000), areas like this offer both affordability and growth potential.
Before jumping in, though, it's worth remembering that successful property investment in 2025 requires a strategic approach. Consider your budget realistically, research emerging areas thoroughly, and think long-term. The best investments often combine current affordability with strong prospects for future growth and development.
Tips for first-time homebuyers in 2025
Stepping into the property market for the first time is exciting and daunting, especially with the shifting landscape we're seeing in 2025. Here are some practical tips to help you navigate this next phase:
Don't wait for "perfect" interest rates. While many buyers are holding out for further cuts, remember that when rates drop, prices typically climb as more buyers enter the market. The current buyer-favourable market won't last forever – sometimes, jumping in at slightly higher rates but lower purchase prices works out better in the long run.
Research is your best friend. Countless first-timers rush into purchases in areas they "think" they know, only to discover hidden issues later. Spend weekends exploring potential neighbourhoods at different times of the day. Chat with locals. Visit nearby amenities. Understanding the area's vibe is just as important as property specs.
Consider location from a lifestyle perspective. A bargain property miles from public transport or lacking nearby shops, cafes, and green spaces might end up being no bargain at all. Consider your daily routine – long commutes can seriously impact your quality of life, regardless of how nice your home is.
Look beyond established hotspots. Growth corridors around major cities are showing tremendous potential. Areas like Melbourne's northern suburbs are proving you don't need to compromise on lifestyle for affordability. With median prices hundreds of thousands below inner-city equivalents, these emerging areas offer value and growth potential.
Don't overlook newer developments or vacant lots. Custom-building a modern home with contemporary needs in mind – think work-from-home spaces, energy efficiency, and better natural lighting - can be a smart move. While established homes have charm, newer properties often deliver better long-term rental appeal and tax advantages through depreciation.
Get your finances properly sorted before house hunting. With current APRA lending rules requiring serviceability buffers on loans, it's crucial to know exactly what you can afford. Chat with mortgage brokers early – they might suggest options you haven't considered, like family guarantees or alternative lending structures.
Remember: Your first home doesn't have to be your forever home – it's just the first step on your property journey.
Why first-time homeowners should consider custom-built homes
Building your first home rather than buying an established one offers a unique opportunity to create exactly what you want from day one. Rather than inheriting someone else's design choices and potential problems, custom building lets you craft a space that suits you perfectly.
When you build custom, every element—from the floor plan to the fixtures—is selected by you. No compromising on layout or settling for that awkward spare room that doesn't quite work. Your home can be designed around your specific needs, whether that's a dedicated home office, a chef's kitchen, or energy-efficient features that save money long-term.
Modern building standards mean new homes are significantly more energy-efficient than properties built even five years ago. You'll enjoy lower utility bills and reduced environmental impact with proper orientation and contemporary materials. Everything in your new build also comes with warranties and incorporates the latest technology and building practices.
Maintenance is another compelling reason to build. New homes require far less upkeep in the early years of ownership—no surprise repairs or hidden issues from years of wear and tear. This gives first-time buyers precious breathing room to establish themselves financially after making such a significant investment.
Navigating roadblocks with Jem Homes
If building your first custom home sounds like an idea that belongs in the too-hard basket, the right builder is all you need. We work with our clients to make potential obstacles manageable stepping stones. Many first-time builders face common roadblocks: securing financing, understanding the complex building process, managing budget constraints, and simply knowing where to begin.
The building process itself can seem daunting – from selecting land and designing your home to managing construction timelines. Many first-timers report feeling lost in technical jargon and overwhelmed by seemingly endless decisions. This is where partnering with Jem Homes makes all the difference. Unlike volume builders offering limited customisation, we provide personalised guidance through every stage of your building journey. Our dedicated consultants work with you to understand your specific budget constraints, lifestyle needs, and design preferences.
Let our experts walk you through available government grants, help you maximise your buying power, and explain options for staging your build to manage upfront costs more effectively. Let's get started today!