Melbourne Property Market Update
Hi,
The clearance rate has remained steady at 76% on 656 properties that went to auction over the weekend. 349 properties sold at auction, 149 selling before auction and 158 passed in. In addition, there were 297 private sales. In comparison, there were 750 auctions reported to the REIV for the same weekend last year, resulting in a clearance rate of 80%.
The clearance rate continues to be in the 70% range which indicates we are in a balanced market however buyers are ensuring they are ticking a lot of boxes before making the leap into purchasing. In a heated market, buyers are compromising on location, condition, orientation and so on just to get into the market. In the current market, all of these items are coming into consideration before a buyer is willing to commit to purchasing the property and after they have decided to purchase, most buyers are cautious of the price they are prepared to pay.
The big four banks have revised their interest rate forecasts and believe the cash rate has peaked at 4.35%. All agree that the RBA may start cutting interest rates at the end of this year but potentially could be sooner if the economy slows down too much in an effort to avoid a recession. CBA, Westpac and NAB are all predicting that interest rates will decline next year to around 3% cash rate. These predictions come as Australian wage growth unexpectedly slowed in the first quarter of this year and is showing signs the labour market is finally starting to soften.
6 Dean Street, Kew attracted a huge crowd at auction on the weekend. The four bedroom, two bathroom, single level home on 615 sqm was quoted $3,000,000 to $3,300,000 prior to auction. It was a popular home and attracted competitive bidding from 6 parties to sell for a huge $3,990,000 under the hammer.
Have a great week
Kim Easterbrook
