The Victorian capital saw surging growth in its property market in 2013, logging another year of double digit growth.
Figures released by real estate consultancy RP Data over the weekend indicate that the median house value for Melbourne grew by 10.7 per cent during the 12 months to the end of December 2013, rising past the $400,000 threshold to hit $442,043.
Median unit values also enjoyed strong growth, rising by 9.8 per cent, or nearly $40,000, to hit $442,043.
Robert Larocca, Victorian spokesman for RP Data, said the company's figures indicated growth in many Melbourne suburbs had held steady throughout the year despite a volatile final quarter for certain suburbs such as Maribyrnong.
"It ended well, but not more strongly than it started, which enabled buyers to keep pace with the market," Larocca said.
Much of the robust growth in the value of Melbourne's homes and units was the result of a strong performance by the eastern and inner northeastern suburbs, where Kew East topped the list for the city overall with a 22.4 per cent gain in median house prices, equivalent to a rise of $205,901.
Despite a volatile final quarter in 2013 which saw prices plunge by 8.5 per cent just prior to Christmas, the inner-west suburb of Maribyrnong also logged a remarkably performance for the year overall, with its median house value rising by 21.4 per cent, or nearly $128,000, to hit $726,851.
Larocca expects growth to remain for Melbourne in 2014, with consumer confidential potentially pushing median prices to unprecedented highs.
RP Data's figures follow a survey conducted in 2013 by Demographia International which determined that Melbourne is one of the least affordable cities in the world, situated in between New York and London in terms of relative housing costs.
Median-priced property in Melbourne is currently around seven and a half times greater than median annual household income, as compared to only three times greater back in 1964. This means that in the past 50 years, houses in Melbourne have become two and a half times more expensive relative to income.