Hi,
Domain’s preliminary Melbourne auction clearance rate for the weekend has come in at 73%. 648 auctions have been reported, 470 selling, 47 withdrawn and 109 passing in. As a comparison, the Domain clearance rate for the same time last year was 60%.
Last week we saw the Reserve Bank of Australia cut interest rates by 0.25%. Usually, with every interest rate cut that we have, we experience an immediate increase in ‘new buyer enquiry’ from both investors and owner occupiers. However, last week the burst in enquiry did not happen albeit we continued to see consistent enquiry come through. This could mean that some buyers could have already been factoring in that interest rate cut and did not wait for this announcement to commence their search.
Also I feel the auction results over the weekend were a bit of a mixed bag, some selling strongly and others not so strong. These could be positive signs that we are not entering into a ‘booming’ market but more a property market with ‘slow and steady’ price growth which is much more sustainable. Interstate investor enquiry is still strong and we are seeing more and more families moving to Melbourne from Sydney where properties are more affordable yet good job prospects are available.
The buyer sentiment has improved considerably and we are in a totally different market than what we were 12 months ago. However, at this stage there isn’t any FOMO (fear of missing out) in the property market and buyers are generally being firm with their budgets. It may take another interest rate cut or two before this changes.
Have a great week.
Kim Easterbrook – Managing Director
