This article was first published via domain.com.au Dr Andrew Wilson
Image: Stephen Smith, of Marshall White, in action during the auction of the property at 17 New Street, Brighton. Photo: Craig Sillitoe
The Melbourne home auction market recorded a spike in activity on the weekend, following last week’s decision by the Reserve Bank to cut official interest rates.
Saturday’s strong 77.9 per cent result was higher than the previous weekend’s 75.7 per cent and the second-highest reported this year. The weekend result was just below the 79.5 per cent recorded over the same weekend last year.
Auction numbers, however, remain relatively low with just 612 properties listed at the weekend. This was lower than the 676 the previous weekend and well below the 950 auctioned over the same weekend last year.
Auction numbers, although set to rise gradually over coming weekends, will likely remain well below last year’s boom-time record numbers. Listings will be similar to the 2014 and 2013 pre-spring markets.
Melbourne’s suburban regions reported consistent results at the weekend, with a small variance between high and low clearance rates.
Melbourne’s south-east region again produced the highest clearance rate at the weekend, with a strong 87 per cent result. The next highest was the inner south with 83 per cent and the highest listings at 73, followed by the outer east with 79.2 per cent, the west with 78.4 per cent, the north-east with 78.3 per cent, the north with 76.3 per cent, the inner city with 75.4 per cent and the inner east with a better result this week at 73.2 per cent.
Notable sales reported at the weekend included:
- a five-bedroom home at 61 Streeton Crescent, Ivanhoe East, sold for $3.35 million by Miles Real Estate;
- a three-bedroom home at 1a Mair Street, Brighton, sold by Buxton for $2.6 million;
- a four-bedroom home at 10 Hazeldine Road, Glen Iris, sold by Marshall White for $2,538,000;
- a five-bedroom home at 139 Linacre Road, Hampton, sold for $2.52 million by Buxton.
The most expensive property reported sold at auction was a three-bedroom home at 9 Victoria Avenue, Canterbury, sold for $4.11 million by Kay and Burton. The most affordable property reported sold at the weekend was a one-bedroom unit at 3/239 Canterbury Road, St Kilda, sold for $211,000 by Gary Peer and Associates.
Melbourne recorded a median auction price of $777,500 on Saturday, higher than the $750,000 reported last weekend, but 5.3 per cent lower than the $821,000 recorded over the same weekend last year. A total of $253.2 million was reported sold at auction in Melbourne at the weekend.
The Melbourne auction market reported a sharp increase in auction activity over the month of July, with overall clearance rates rising from 67.7 per cent over June to 71.7 per cent.
Average weekend auction volumes were down over the month, falling from 723 to 457 – well below the 585 averaged over July last year. But over the year so far, Melbourne’s auction numbers are sitting at 18,505, having fallen by just 1.3 per cent or 239 fewer compared to the same period last year.
Low interest rates are a key driver of robust auction markets and rising home prices, with the cut to official rates in May enhancing buyer momentum. Last week the Reserve Bank decided to again cut rates to a record low 1.5 per cent, with another low inflation rate recorded over the June quarter a clear catalyst for the RBA’s decision.
With banks passing on lower rates to mortgage holders and prospective home buyers, rising buyer activity and overall solid market confidence is set to be maintained through to spring.