Melbourne Auction Results 14th September 2015

Increased stock levels from vendors trying to “beat” the Spring rush and sell before the end of September is seeing an influx of new listing hit Melbourne’s property market, creating opportunities for would-be buyers. In this week’s property market wrap Peter Sarmas takes a look at local property news and the state of the economy.

A clearance rate of 75 per cent was recorded this weekend compared to 75 per cent last weekend and 73 per cent this weekend last year. There were 1007 auctions reported to the REIV this weekend, with 759 selling and 248 being passed in, 92 of those on a vendor bid.

There have been 25,800 auctions held in the year to date – the highest on record for any given year. Sales volumes have also been the highest on record, with an estimated 84,000 sales transacted so far this year.

Are We Heading For A Buyer’s Market?

A raft of news this week both economic and property related that seem to be pointing to a similar direction, signs of slowing.

Economy

Let’s talk economics firstly.

The latest unemployment figures released last week surprised many, especially those predicting an Australian recession, the unemployment rate actually fell to 6.2 per cent from 6.3 per cent. The economy added 17,400 jobs and the number of unemployed declined by 14,400.

Consumer confidence also took a hit in September declining 5.6 per cent. This was no surprise according to Chief Economist Bill Evans, pointing to worsening and global economic outlooks.

Mr Evans saying, “This solid fall in the Index comes as no surprise. We were somewhat puzzled by the surprise increase in the Index last month of 7.8% and there was always likely to be some correction this month”.

“Of course the deluge of disturbing news around violent gyrations in both Australian and overseas equity markets, poor economic data from China, a disappointing report on Australia’s growth rate and the weakness in the Australian dollar were also likely to have unnerved households.”

Looking at housing market confidence specifically, consumer sentiment around ‘time to buy a dwelling’ fell by 0.9% to 8.6%, down on a year ago and a huge 30% lower than two years ago. However these numbers appear to be more indicative of the affordability issues surrounding upgraders and first time buyers rather than investors.

Supporting the current investor strength, the Index revealed a large proportion of respondents choosing real estate as the wisest place to invest their savings, the highest level since September 2003, which coincidentally was the last investor-led boom in property.

“In that regard, note that the Westpac – Melbourne Institute Index of House Price Expectations continues to point to rising prices, albeit at a slower pace” explained Mr Evans.

Street Advocate

On the property front there appears to be signs of softening in certain sectors of the market. Increased stock levels, in particular from vendors trying to “beat” the Spring rush and sell before the end of September, is seeing an influx of new listing hit Melbourne’s property market, creating opportunities for would-be buyers.

According to APM, stock levels have jumped 20 per cent this year on 2014, reflecting strong market conditions and vendor confidence. However we are already seeing a glut of certain type of properties beginning to affect property prices and perception of the current market. My view is this sudden glut in supply only lasts a short term (provided the property is a quality asset) and gives astute buyers an opportunity to get into the market. A grade properties are still being targeted by astute buyers at the expense of B and C grade properties.

Many real estate agents over the weekend were rubbing their hands at the increased levels of stock about to hit the market. September the 26th is expected to be a big day for auctions and October is shaping up as a very strong start to the Spring market. If these early signs are any measure of what’s to come, I believe we are in for a very good buying market and expect property prices to correct between 5-10 per cent, as they did last year.

For those looking to sell their home, get in quick. While for those of you who have been sitting on the sidelines this may be the time to think about buying.

Good luck and do your due diligence!

Top 5 Houses

1.  32 Heyington Place, Toorak $4,605,000
2.  30 Campbell Street, Kew $4,210,000
3.  5 & 7 Braeside Avenue, Camberwell $3,836,000
4.  4 Walnut Road, Balwyn North $3,570,000
5.  1 Barkly Street, Brunswick East $3,400,000

Top 5 Bargain Houses

1. 2421 Warburton Highway, Yarra Junction $273,000
2. 21 Lakeside Drive, Roxburgh Park $285,000
3. 42 Dianne Avenue, Craigieburn $290,000
4. 21 Candle Bark Crescent, Frankston North $293,000
5. 40 Tattler Street, Carrum Downs $330,000

Top 5 Apartments

1. 36 Black Street, Brighton $2,120,000
2. 13/17 Marshall Avenue, Kew $1,850,000
3. 4/11 Wilson Grove, Aspendale $1,580,000
4. 30 Central Avenue, Black Rock $1,540,000
5. 1 Melville Lane, Brighton $1,380,000

Top 5 Bargain Apartments

1. 12/69-71 Delhi Court, Travancore $263,000
2. 3/3 Edna Street, Thomastown $276,000
3. 169-173 Keele Street, Collingwood $290,000
4. 17/83 Rufus Street, Epping $296,100
5. 6/2D Cunningham Street, Northcote $315,000

Source: REIV