Crime up, values down: there goes the neighbourhood
Home invasions and drive-by shootings in some suburbs are not only putting residents in fear of their lives, but the crime surges are hurting community appeal and home values.
‘THERE goes the neighbourhood.’ Originally a US racist jibe, in Australia it’s more often a joke about perceived negative change.
Maybe a halfway house or needle exchange. A new fast-food outlet or skate park. A council “street art” wall.
Increasingly, it’s muttered in response to local crime and the potential effect on housing values.
Like homes peppered with bullets and getaway cars torched in Sydney’s west and southwest. Machete-wielding gangs running rampage through Melbourne.
Research suggests violent crime like assault and robbery can affect prices in affluent areas, while burglaries more often hurt middle-income suburbs.
A murder nearby can see a dramatic but temporary drop. More enduring, is the stigma of persistent vandalism and graffiti.
Crime doesn’t usually figure in housing indices but was addressed by leading analyst Louis Christopher in his recent SQM Research Boom and Bust Report.
He felt Melbourne property might under-perform in 2026, but as quoted by realestate.com.au said “resolving crime issues would help in the mid to long term.”
“People should still feel safe, but the crime stats are up,” Mr Christopher added.
“That puts doubt in the minds of investors and even first-home buyers. It creates caution when it comes to spending a lot of money on a home.”
Others insist crime has little effect and can be offset by gentrification.
A study by InvestorKit found Burwood, NSW had a crime rate of 21% (21 crimes per 100 people) in 2014. A decade later Burwood home values had increased 130%.
Kogarah Bay, on the other hand, had a 2013 crime rate of just 2%, but values only increased by 94%.
Burwood is closer to the city, with major transport links and a landmark shopping centre. Advantages that outweigh any disadvantages.
As that 2024 study also noted, the biggest consequence of local crime might be higher insurance premiums.
When bullets fly, it might be time to bag a bargain.
