Melbourne Auction Results – July 13th
The event the whole world was waiting on came and went last Monday, leaving sharemarkets around the world in turmoil. Will the latest Chinese and Greek Turmoil Affect Property Prices?
A clearance rate of 77 per cent was recorded this weekend compared to 77 per cent last weekend and 69 per cent this weekend last year. There were 507 auctions reported to the REIV this weekend, with 392 selling and 115 being passed in, 45 of those on a vendor bid. The number of auctions is expected to increase over the next fortnight with on average 750 auctions in each of the next two weekends.
Clearance Rate: 77%
Reported Auctions: 507
Sold at Auction: 316
Passed in: 115
Sold Before: 75
Sold After: 1
Auction Volumes: $271.91m
Last Weekend: 576
Last Year: 524
Houses: 82%
Units: 72%
Will the latest Chinese and Greek Turmoil Affect Property Prices?
Economic Update
The event the whole world was waiting on came and went last Monday, leaving sharemarkets around the world in turmoil.
The reason for the referendum vote put to the Greeks last week was to decide whether to accept or reject the austerity measures put to them by the European Council and in affect decide whether to stay or leave the Eurozone. The vote was a resounding “no” by more than 60% of the voters, which on face value looked like Greece actually saved face and won the fight against tough measures.
In reality though it looks like Greek President Tsipras has had worse measures imposed on his country as capital dries up in Greece and their negotiating position deteriorates.
Share markets around the world experienced wild swings of gains and losses. Closer to home our major trading partner China saw 30% (close to $4 trillion) wiped off its share market value – 11 years of Greece’s gross domestic product, just to put things into perspective. I see this event as a more relevant issue to Australia’s economy and property market.
For those complaining about Chinese foreigners “buying up Australia” and pushing property prices up, particularly in Melbourne and Sydney, this latest event could put the brakes on one of our strongest economic drivers.
In the past 12 months the Chinese sharemarket rose 150%, much of it created through speculation and margin lending, in effect, borrowing heavily to buy into shares. So a sudden recent downturn in the sharemarket triggered a number of margin calls and a “sell off” causing the sudden collapse.
As prices rose in the sharemarket so too did the wealth of many Chinese people. The by product of this market rally was to create a “wealth effect” where investors who had made a mozza on the market would go out and spend big on holidays, luxury goods, new cars and property in Australia.
Yes, that’s where we come in. The question now remains is how many of the Chinese developers building in Australia, who by they way are listed on the Chinese stock exchange, have enough confidence and capital to continue their build. And how many of the mainland Chinese investors who were being sold the off the plan apartments in Melbourne and Sydney are able to complete settlement and continue to have the confidence to keep investing.
It will be interesting to see how things transpire, especially in what I call the “Chinese markets”, Melbourne’s Eastern suburbs, like Doncaster, Glen Waverley, Balwyn and the like. How will our new apartment market be affected, considering our Asian friends are such big investors? Are we seeing the start of the expected collapse in Melbourne’s apartment market?
On The Street
Over the weekend the Street Advocate team ventured down to not-so-sunny Richmond to follow a few auctions that were taking place and gauge property interest on two rather contrasting properties at auction. Read our latest auction review to find out how Richmond performed this past weekend.
Top 5 Houses
- 20 Carrington Street, Balwyn North $2,051,000
- 24 Kawarren Street, Balwyn North $1,815,000
- 21 Fraser Street, Glen Waverley $1,680,000
- 77 Heath Street, Port Melbourne $1,640,000
- 15 Afton Street, Aberfeldie $1,600,000
Top 5 Bargain Houses
- 12 Odessa Court, Werribee $288,000
- 60 Meadow Glen Drive, Epping $365,000
- 24 Peppercorn Parade, Epping $371,500
- 54 Woods Street, Beaconsfield $375,000
- 16 Helpmann Crescent, Epping $376,000
Top 5 Apartments
- 20 Anderson Street, South Melbourne $1,675,000
- 10/6 Wellington Crescent, East Melbourne $1,380,000
- 2 Toronto Avenue, Doncaster $1,288,000
- 15 Parkers Road, Parkdale $1,181,000
- 9 Norma Barnett Lane, Port Melbourne $1,180,000
Top 5 Bargain Apartments
- 4/73 Kingsville Street, Kingsville $235,000
- 3/81 Hammond Road, Dandenong $289,000
- 12/35 Glen Huntly Road, Elwood $290,000
- 6/25A Arthur Street, Coburg North $302,500
- 2/24 Highland Street, Kingsbury $307,500
Source: REIV
