Buyer momentum continues to build in the already strong early spring Melbourne home auction market, which recorded month-high results at the weekend.
Melbourne recorded a clearance rate of 78.4 per cent on Saturday, which was ahead of the 77.5 per cent reported over the previous weekend and well up on the 75.7 per cent recorded over the same weekend last year.
The weekend result was the highest recorded by the local market for a month and consolidates the strong start to the early spring selling season over recent weekends. The current robust nature of the Melbourne housing market is in contrast to last spring, when the market tracked backwards under rising mortgage rates.
Saturday’s higher result was recorded despite a sharp increase in auction numbers, with 846 listings reported compared to the 718 auctioned the previous weekend. Auction numbers, however, remained well below last year’s 1034 offering over the same weekend.
The current strength of the Melbourne market is being shared consistently by most suburbs, however, the north continues to be the star performer. The north suburban region recorded the highest clearance rate at the weekend with a booming 89.3 per cent, followed by the outer east with 82.7 per cent, the north-east with 81.5 per cent, the south-east with 80.6 per cent, the west with 78.2 per cent, the inner city with 76.7 per cent, the inner south with 76.6 per cent and the highest sales at 85, and the inner east with a clearance rate of 71.8 per cent.
Notable sales reported at the weekend included:
- a five-bedroom home at 11 Keats Street, Sandringham, sold by Hocking Stuart for $3.75 million;
- a five-bedroom home at 14 Marlborough Avenue, Camberwell, sold for $3.36 million by Marshall White;
- a four-bedroom home at 29 Fairfield Avenue, Camberwell, sold for $3,165,000 also by Marshall White;
- a four-bedroom home at 58 Auburn Grove, Hawthorn East, sold for $3.1 million by Kay and Burton;
- a four-bedroom home at 32 Caroline Street, Clifton Hill, sold by Collins Simms for $3,010,000.
The most expensive property reported sold at auction was a four-bedroom home at 204 Esplanade, Brighton, which sold for $6.5 million by Charlton King. The most affordable property reported sold at the weekend was a one-bedroom unit at 25/4 Wando Grove, St Kilda East, which sold for $221,000.
Melbourne recorded a median auction price of $870,000 on Saturday, which was higher than the $860,000 reported last weekend and 7.8 per cent higher than the $806,888 recorded over the same weekend last year. A total of $406.9 million was reported sold at auction in Melbourne at the weekend.
The Melbourne auction market continues to steam into spring, although auction numbers remain well below last year’s record-level offerings. Total listings are also lower, with newly listed homes falling by 4.5 per cent over August compared to the same month last year.
Positive economic news will help to bolster the local housing market, with the Australian Bureau of Statistics reporting that GDP increased by 3.3 per cent over the year ending the June quarter — the best annual result in four years, although much of the recent growth reflected government spending.
Strong buyer activity is being fuelled by historically low interest rates and solid competition amongst banks for mortgage customers. Although the Reserve Bank has predictably left official rates on hold over September after last month’s cut, chances remain of another cut later this year, particularly if the labour market deteriorates, inflation continues to decline and the dollar remains high.
Dr Andrew Wilson is Domain Group chief economist [email protected] join on LinkedIn
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