Hi ,

The team at Elite Buyer Agents are back for 2025 and excited about what this year will bring in the Melbourne and Geelong Property Markets.  Auctions have started and already bringing higher clearance rates than last year.  Auction numbers are still low but will increase weekly and a ‘Super Saturday’ is predicted for the 22nd of February.

Domain Melbourne Auction Clearance rate as at Saturday evening was at 68% on 466 auctions.  315 sold at auction, 108 passed in and 43 were withdrawn.  The clearance rate for the same week last year was 64%.

What a difference 12 months can make in property!  2024 was a tough year in Melbourne for real estate.  There was a lot of negative press about the Melbourne Property Market, confidence was low, investors were selling fast pushing stock levels higher and buyers were very cautious.  Fast forward 12 months, investors are circling, stock levels are low, and it looks like we have hit the peak of the interest rate rises with strong predictions of a rate cut next week.  Not only has Melbourne come alive over the holidays, but there is now a lot of positivity about the Melbourne Property Market for 2025.  A property in Toorak just recently sold for approx. $150m which now holds the record for the country as Australia’s most expensive home.

Melbourne historically has been Australia’s strongest performing property markets until recent years where it has lagged behind.  This is due to the extended lockdowns during the pandemic, increased land taxes, new legislation around rental properties, rising interest rates and a sluggish economy.

Population growth will continue to be a main driver in buyer demand, and the State Government have recently predicted that Melbourne’s population will rise to 8.5 million people by 2051, a huge increase from its current 5.3 million people making it the fastest growing city in Australia.

So what does this mean for property prices in the short and long term?  Over the long term, we will still have supply issues if the population increases at the levels the State Government is predicting, which should keep property prices rising. However for 2025, I still believe it will be a slow and steady pace for the first half of this year.  Buyer confidence has already increased and we saw evidence of lots of buyers at open for inspections on Saturday.  Whilst I feel buyers will still see some good opportunities in the short term, these opportunities will become fewer and far between over time.  I believe the Melbourne Property Market has already entered the recovery phase and both KPMG and CoreLogic are predicting solid property price growth this year which all the signs are there that this could happen.

Have a great week!

Kim Easterbrook – Managing Director

Hi,

A big auction weekend resulted in a solid clearance rate of 78%. 747 auctions were reported to the REIV with 404 properties selling under the hammer, 180 sold before auction, 1 after auction and 162 passed in.  In addition, there were 150 private sales.  In comparison, the final auction clearance rate last year was 73% on 986 auctions.  The final result last week was 1,056 auctions reported resulting in a final clearance rate of 79%.

A clearance rate in the high 70%’s demonstrates the market is balanced, transactions are happening, however our experience on the ground showed a mixed bag of results.  Over the weekend, we were successful in purchasing five properties at auction and still in negotiations for two others.  Reserve prices generally were conservative and properties were selling ‘under the hammer’ at lower prices than we were expecting. Great news :).  Also many auctions passed in and selling via negotiations immediately after with vendors meeting the market in order to have their property sold.  We believe the buying conditions will be similar this weekend coming.

2024 has certainly been an difficult year in the Melbourne Property Market.  Lots of uncertainty with increasing interest rates which have now thankfully stabilised.  Investors left the property market in droves due to increases in land tax, rising interest rates and changes in compliance and minimum standards for rental properties.  Many buyers have been sitting on their hands watching the market but not wanting to act.

Now that interest rates have stabilised, confidence appears to be building (albeit slowly) and interstate investors are circling, the outlook for 2025 is much more positive.  I feel it will be a slow and steady start to the New Year.  The number of properties launching in February are on the lower side (according to many Selling Agents we have spoken to).  This should keep the market balanced for the first few months of the year however conditions should still be favourable to buyers to an extent.

As interest rates come down mid next year (hopefully), buyer confidence will likely go up.  Melbourne has not seen any property price growth for quite some time, and declining interest rates could result in slow increases in property prices.

But for now, we have one more weekend of auctions and a week or so left of off market activity then our office will be closed until mid January.  We hope you all have a wonderful break, Seasons Greetings and Happy New Year!

 

From the team at Elite Buyer Agents

Hi,

The clearance rate is sitting in the high 70%’s which is a good result but not unexpected.  As Christmas approaches, vendors are keen to have their property sold as the ‘psychological’ deadline approaches.   This means that many vendors are prepared to meet the market in order for their property sold before Christmas, even if it is less than they were hoping for.

Over the weekend, 856 auctions were reported to the REIV resulting in 466 selling at auction, 198 selling before auction, 1 selling after and 191 passing.  Volume is slightly down on last year where there were 995 auctions reported for the same weekend also resulting in a clearance rate of 78%.

There is a lot of talk about Melbourne property of late and a general feeling that property is undervalued. Property prices in most capital cities across the country have had huge gains over the past 12 months with Melbourne’s property price performance being one of the weakest.

Currently, Sydney’s median house price is 70% higher than Melbourne, this is the largest price gap in 20 years.  However, there predictions by many that the gap between Sydney and Melbourne property prices may decline as projections are still in place that Melbourne’s population will match Sydney’s by 2036.

We can already sense confidence in the market is increasing (albeit slowly) and there is strong buyer enquiry from interstate investors who are wanting to get into the Melbourne property market.

Whilst we know a recovery will likely be slow, and unlikely to happen until interest rates start coming down.  I do believe this gives us a small window where the conditions for buyers will be favourable and a good time to enter in the market.  Buyers sitting on their hands waiting for interest rates to come down put themselves at risk of not taking advantage of the current buying conditions which we are expecting to turn mid next year.

Have a great week!

 

Kim Easterbrook – Managing Director

Hi,

A quieter auction weekend this weekend with 651 auctions reported to the REIV resulting in a clearance rate of 76%.  367 properties sold at auction, 126 before auction and 158 properties passed in.  In comparison, the same weekend last year had 1,014 auctions resulting in a clearance rate of 70%.

The Spring selling season was a little lacklustre this year, we did not see the amount of stock come onto the market that we were hoping for.  It appears that some sellers are still sitting on their hands (and waiting to put their property on the market) in the hope that there was going to be an interest rate cut in February, which is now looking more and more unlikely.  The lack of stock has kept the property market balanced with no increases or decreases in property prices from what we can see over the past couple of months.

What has changed however, is the increase in enquiry from interstate and overseas (Aussies living abroad) buyers wanting to purchase in Melbourne and Geelong.  And it hasn’t been just a small jump in enquiry, it has been significant.  This could signal positive news for the Melbourne property market which has been underperforming for quite some time now.

The interest rate cut being delayed may have stalled any immediate recovery in the property market however there does seem to be an increase in confidence but until we see interest rates coming down, we should continue to have a window of reasonable buying opportunities in the months to come.  Once interest rates start coming down, I strongly believe the property market will enter into a recovery phase and therefore we will likely see prices increase.  It certainly feels like we have hit the bottom of the property market and the peak of interest rates.

We attended and were successful at a very competitive auction at the weekend, 4/10-12 Eley Road, Burwood which is a three bedroom, renovated, single level home.  The property had strong interest from both owner occupiers and investors and was quoted at $880,000 to $960,000 prior to auction and attracted six bidders in total.  The property was announced on the market for $970,000 and sold for $1,052,000.

Have a great week!

Kim Easterbrook – Managing Director

Hi,

The REIV auction clearance rate remained steady at 78% with 358 properties selling at auction, 157 before auction and 149 auctions passing in.  There were an additional 313 private sales.  In comparison, there were 936 auctions reported to the REIV last year resulting in a clearance rate of 72%  The final REIV clearance rate for last week was 812 auctions resulting in a clearance rate of 75%.

CoreLogic last week released its September quarter Home Value Index showing that Melbourne property prices declined by 1.1%.  While Sydney, Brisbane, Adelaide and Perth continued in the upwards direction, the rate of growth is slowing.  Hobart, Darwin and Canberra also experienced in a decline in property prices.  Regional Victoria overall dropped 1.4% which was the largest decline in property prices in the country.  The tree change/sea change Victoria experienced over the Covid years has lost its momentum with some choosing to sell and move back to the city or interstate.

Whilst there is a continuation for some Victorian investors to exit the property market.  The downward direction of property prices is mostly due to the increase in stock on the market, which is a usual trend for Spring.  Properties are taking longer to sell with average days on market increasing from 27 days to 41 days.  Spring is looking to be a great time for buyers to enter the Melbourne and Regional Victoria property market.

Corelogic also reported an increase in consumer confidence with inflation easing and the next interest rate move looking to be an interest rate cut.  Over the next six weeks leading into Christmas, there should be a further increase in properties coming onto the market which should keep the buying conditions favourable to buyers.  But my feeling is that this could be shortlived and there is a question mark as to whether stock levels will be as healthy in the New Year as they are now.

That all being said, it is still to be noted that good quality properties in Melbourne have still been selling well under competition.  The auctions we attended on the weekend all had active bidding from multiple bidders and sold under the hammer.

Have a great week!

Kim Easterbrook – Managing Director

Hi,

The REIV reported a lower volume of auctions this Saturday in comparison to the same time last year.  638 auctions were reported to the REIV with 348 selling at auction, 124 selling before auction and 166 passing in.  There were an additional 139 private sales.  The same weekend last year the REIV reported 841 auctions and a clearance rate of 78%.

Investors are continuing to leave the Victorian property market with new data being released by the Department of Families, Fairness and Housing showed that rate of investors selling their investment properties is rising.  They looked at the amount of rental bonds (an amount held at the Residential Tenancy Bond Authority) declined from 676,400 in June last year to 654,700 to June this year, which indicates there are 21,700 less rentals.

The survey conducted also suggested that 22% of investors had sold at least one investment property in the past year which is the second highest level in the country after Brisbane.

Corelogic has released data suggesting that rental growth in Melbourne has now slowed to its lowest growth rate in three years.  The three months to August 24 showed an increase of 0.8% but the change in rentals for the 12 months to August 24 was 7.0%.  This is partly due to the slow down in net overseas migration.

Interestingly though while some investors are getting out of the market, some investors are seeing Melbourne/Victoria as an opportunity to get into the property market with investor lending increasing by 10.7% and the value of its lending has increased by 30.2%.

Have a great week!

Kim Easterbrook – Managing Director

Hi,

There were 573 auctions reported to the REIV resulting in a clearance rate of 79%.  322 properties sold at auction, 128 before auction, 1 after auction and there were an additional 255 private sales.  In comparison, the same weekend last year there were 817 auctions reported to the REIV resulting in a clearance rate of 76% and last week’s final result was 813 auctions reported resulting in a clearance rate of 78%.  The Melbourne property market does still feel quite price sensitive, where buyers are generally cautious about what they are wanting to pay due to high cost of living, higher interest rates and generally a level of caution still in the market.

CoreLogic released it’s data last week showing that Melbourne’s median ‘dwelling’ value has fallen into sixth place with only Hobart and Darwin behind it.  Melbourne’s median ‘house’ price though is still the third most expensive with only Sydney and Brisbane ahead.  There has been a lot of media reporting last week that Melbourne’s ‘house’ price values have slipped to sixth against most capital cities in the country but the reporting is inaccurate as it is the ‘dwelling’ value that has fallen to sixth position across the country.

CoreLogic’s ‘dwelling’ value also includes units and apartments which gives an average of all property prices against all types of property.  According to Tim Lawless (CoreLogic’s research director), a third of all housing stock in Melbourne is medium to high density, where has Perth and Adelaide has a multi unit stock of around 16%.  Units and apartments have a lower price point, and have been slugglish in capital growth for a number of years now and therefore pulls the average ‘dwelling’ averages down.  This therefore skews the data as they are not really comparing ‘apples with apples’.

With Melbourne’s ‘dwelling’ median now sitting in sixth position against other capital cities across the country, it definitely shows that if a first home buyer is looking to enter the market, Melbourne does become an appealing option with a healthy supply of one and two apartments and townhouses.  But this could be shortlived as the number of apartments proposed for construction are now sitting at its lowest since 2007 which will in time, affect the overall supply on offer for perspective purchasers and tenants.

In some positive news for Victoria’s property market, investor loans have increased 9 percent (albeit, lower than the national average) and there are an increasing number of investors circling Melbourne viewing it as a good opportunity to purchase in.

Have a great week!

Kim Easterbrook – Managing Director

Hi,

628 auctions were reported to the REIV on the weekend resulting in a clearance rate of 77%.  357 sold at auction, 124 sold before auction and there were an additional 432 private sales (a very large number).  In comparison, the same time last year there were 843 auctions reported resulting in a clearance rate of 74%.

ABS released its CPI data for the month of July with promising news showing it has slowed and is at a rate 3.5% which is less than the 3.8% result in June.  Still short of the 2% to 3% RBA target but it is certainly heading in the right direction.

Whilst too early for any RBA interest rate cuts, CBA, ANZ and NAB have lowered their interest rates paid on term deposit due to their predictions of rate cuts next year.  CBA has also cut its variable interest rates for most new home loan customers.  NAB, Macquarie, Westpac and CBA have cut its fixed rate loans with the subsidiary lenders following suit.

PropTrack Home Price Index released their national median home price for August showing Melbourne’s median house price declined by 0.18% (effectively remaining stable).  But this is lagging behind Sydney, Brisbane, Adelaide with Perth experiencing the strongest growth at 0.79% for the month.  The index did show that it appears that property price growth across the country has slowed and there is a feeling this will be the case moving forward until we see interest rates come down.

The auction of 62 Stockdale Street, Bentleigh East attracted a large attendance of 60 people.  The renovated home was quoted at $1,500,000 to $1,560,000 prior to auction.  There were three active bidders with the property declared on the market at $1,652,000 and selling at $1,657,000 with the remaining two bidders down to $500 bids.

A single level Guilford Bell architecturally designed home in Toorak sold for $1,200,000 above reserve.  The auction of 184 Kooyong Road, Toorak only attracted two bidders, but two bidders that really wanted the property.  The property was announced on the market at $5,200,000 and sold for $6,400,000.

Have a great week!

Kim Easterbrook – Managing Director

Hi,

There were 577 auctions reported to the REIV resulting in a clearance rate of 77%.  315 sold at auction, 130 sold before auction, 1 sold after auction and 131 passed in.  In addition, there were 133 private sales.  In comparison, there were 876 auctions reported to the REIV last year resulting in a clearance rate of 74%.

Other cities across the country have been experiencing strong home value growth whilst Melbourne property price growth has slowed considerably.  Melbourne and Sydney historically always had the highest median house price however Brisbane has now surpassed both Melbourne’s median house price and unit value.

But why is Melbourne lagging behind when it once was one of the strongest property markets?  It really is due to a COVID handover.  The ongoing impact of lockdowns has been a real challenge for Victoria’s (in particular Melbourne’s) economy.  Hospitality and retail were most affected and then the Government has introduced higher taxes on both businesses and property owners.

In addition to this, compulsory minimum standards were implemented for rental properties (more $ outlayed by rental providers).  Increased land tax, then higher interest rates and costs of living with rent rises not keeping up with the higher running costs of these investment properties.

Whilst immigration is still strong (mostly from overseas), there have been some people packing up and moving intestate and others just selling their investment properties and exiting the state’s property market.

Whilst confidence in the Melbourne property market is still low, we know Melbourne is a great city to live and in time, demand for property should increase.  A few interest rate cuts will likely be all it takes for the confidence to come back into the Melbourne property market.  Historical behaviour has shown that once confidence builds in the market, other buyers will follow… and usually at a fast rate, and Melbourne could yet again become one of the (if not the) highest performing property market in the not to distant future.

But meanwhile, we had another patchy auction weekend with a mixed bag of results, some auctions had active bidding, whilst others had one bidder or none at all.

That being said, there is always an auction that has strong bidding and worth speaking about.  The auction of 25 Thomson Street, Seddon had good interest mostly from first home buyers.  The property was small but typical for the area but was well located and had a pretty double fronted facade.  The property was quoted at $1,100,000 to $1,200,000 prior to auction and sold with three bidders participating in the auction for $1,345,000.

Have a great week!

Kim Easterbrook – Managing Director

Hi,

There were 522 auctions reported to the REIV over the weekend resulting in a clearance rate of 75%.  284 sold at auction, 109 before auction and 129 passed in.  There were an additional 225 private sales.  As a comparison, the same time last year there were 677 auctions reported to the REIV resulting in a clearance rate of 78%.

The first of Victoria’s faster trains has officially starting taking passengers with another 22 trains to follow.  These trains will run on the Geelong, Baccus Marsh and Melton corridors among other lines with the aim to deliver more reliable and faster journeys.  The trains can reach speeds of upto 160 km/hour and along with the Melton Line Upgrade, will increase capacity by 50%.

This will be a welcomed relief to Melbourne’s west where population growth has been strong and current levels of public transports have been insuffient in keeping up with current demands.

Faster and more frequent train services from Geelong to Melbourne (and return) will make this area an even more desirable location to live.  With a much more affordable housing market then Melbourne, very good schools and now an even more commutable distance, it is very likely Geelong will experience a continuation of increased property prices and higher rents.

Over the weekend there were a mixed bag of results demonstrating there is still an element of cautiousness in the market.  This was seen at the auction of 36 Horne Street, Elsternwick.  The property had a strong campaign with many buyers inspecting the property but come auction day, only three bidders came to light.  The 3 to 4 bedroom, 2 bathroom period home in good condition (kitchen could do with an update) but well located and land size of 630 sqm is large.  The property was quoted for $2,000,000 to $2,200,000 with three bidders trying to secure with the property selling for exactly what it was worth at $2,300,000.

Have a great week!

Kim Easterbrook – Managing Director

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