Hi,
The Melbourne auction clearance rate dipped slightly to 67% but that was due to a very high volume auction weekend. 1,263 auctions were reported to Domain with 841 selling, 134 withdrawn and 288 passed in. In comparison, the same weekend last year resulted in a clearance rate of 61%.
The Domain House Price Report was released last week which showed Melbourne’s Sept 25 quarterly median house price increased 2.2% to $1,083,043. Very close but still $10,000 lower than the record high in 2021. The median unit price rose 1.7% in the September quarter to $590,597 which is within $12,000 of the record high in December 2021.
Property prices are predicted to continue to rise throughout the December quarter but the rate of the price growth will be highly impacted by the RBA’s interest rate decision next week. If interest rates are reduced, the rate of property price growth may be higher than if they were to stay on hold. Each interest rate reduction this year has resulted in a instant increase in buyer confidence in the property market.
The countdown is on to Christmas with only a few more weeks of auction campaigns launching and then mid November to mid December will move into a private sale market and the activity of off market properties will rise in the lead up to Christmas.
Have a great week
Kim Easterbrook – Managing Director
Hi,
The clearance rate remained stable on a high volume auction weekend. 816 auctions were reported to Domain, of those 589 sold, 149 passed in and 78 were withdrawn resulting in a clearance rate of 72%. In comparison, the same weekend last year produced a clearance rate of 59%.
Interest rates are in much discussion again as the Reserve Bank of Australia are due to meet on the 3rd and 4th of November. Last week, the Australian Bureau of Statistics released data showing that unemployment rose from 4.3% to 4.5% in September which is the highest rate since the pandemic in 2021. In addition, consumer confidence is falling, as to are building approvals. Last week it was looking extremely unlikely that there were to be another interest rate drop, now it is back on the table.
What this means for the property market is if we see another interest rate cut in November, there may be increase in buyer confidence just before Christmas. Melbourne’s property market has been very sensitive to interest rate movement. Everytime interest rates drop, there is an increase in buyer activity. Each time they remain on hold, activity somewhat slows down/stabilises.
Next weekend will be a big test for the property market with almost 2,000 properties going under the hammer. The higher number is a result of the Melbourne Cup weekend where there are only a handful of auctions.
Have a great week
Kim Easterbrook – Managing Director
Hi,
A very big auction weekend with 831 auctions being reported to Domain. Of those, 610 sold, 150 passed in and 71 were withdrawn resulting in a solid clearance rate of 73%. In comparison, the same weekend last year produced a clearance rate of 58%.
Melbourne property has been a hot topic this year and interstate investors have been circling. Since 2020, the Melbourne property market has taken a hit. A number of things have contributed to this, harsh Covid lockdowns, downturn in the economy, the state government increasing land taxes, stricter compliance for rental property standards and then rising interest rates.
Since the lockdowns ceased at the end of 2021, the economy has been slowly recovering but then interest rates started to rise which stopped the recovery in the property market. In February 2025, the Reserve Bank handed down the first interest rate cut and then followed with two more interest rate cuts with the last being in August 2025.
Historically, the Melbourne property market has been one of the strongest performing markets in the country and after years of a lull, property prices are rebouding.
Why is Melbourne property appealing to investors?
In addition to declining interest rates, the underperforming property market has a lower median house price (lower entry price point) than Sydney, Brisbane and Canberra.
Population growth is strong, during the COVID-19 period, there was a population decline but this has strongly rebounded. In the year ending June 2024, the ABS states that Greater Melbourne’s population grew by 2.7% (142,637 people). The prediction for the year ending June 2025 is an increase of approximately 100,000 people.
Population growth has not just put pressure on property prices, but also rental demand. Investors buying a good quality property should have no issues in finding a tenant quickly.
Huge amounts of money have been put into infrastructure including roads, trains, hospitals and so on.
High quality education, not just at a tertiary level but also primary and secondary schools. This offers a good lifestyle for families and just another reason why Melbourne is great city to live.
Many research companies are predicting Melbourne to be the top-performing capital in 2026 including KPMG which is predicting Melbourne property prices to rise by 6.6%.
Spring is often a great time to buy with higher levels of stock (properties on the market) and off-market activity rises in late November and December leading into Christmas. This will likely present buyers with some better buying conditions leading into 2026.
Have a great week
Kim Easterbrook – Managing Director
Hi,
A big auction weekend with 817 auctions being reported to Domain. Of that, 574 sold, 177 passed in and 66 were withdrawn resulting in a clearance rate of 70%. In comparison, the same weekend last year produced a clearance rate of 59%.
There were no surprises last week with the Reserve Bank deciding to keep interest rates on hold but they warned the likeliness of another interest rate cut this year is declining. Stronger than expected household spending was recorded in August and the RBA are not willing to reduce rates until they have received quarterly data from the Australia Bureau of Statistics, which they deem to be more accurate than the monthly data. The next round of quarterly data is due at the end of October, just in time for the next RBA meeting with is the 3rd and 4th of November.
The lack of interest rate movement has removed any FOMO (fear of missing out) in the property market, but it has created stability, which is not such a bad thing. That being said, the sub $950,000 market may start feeling the heat with the rollout of the first home buyers’ guarantee from the federal government.
The 5% Deposit Scheme will allow first home buyers to secure a home loan with a deposit as low as 5% without needing to pay Lenders’ Mortgage Insurance (LMI). The federal government will provide the bank a guarantee for upto 15% of the sale amount. There are no place limits or income caps to first home buyers who can acccess the scheme.
The spring selling season has begun which means more stock has already come onto the market (properties for sale) and with the chance of no more interest rate cuts for the rest of 2025, this may mean the price pressure may be eased for properties in the $950,000 plus market and we may see some reasonable buying conditions. The sub $950,000 market will likely see some increase in demand as more buyers enter these markets through the first home buyers’ guarantee.
Have a great week
Kim Easterbrook – Managing Director
Hi,
A big weekend of auctions with 941 auctions reported to Domain with the Melbourne auction clearance rate achieving 71% over the weekend. 668 properties sold, 200 passed in and 73 were withdrawn. In comparison, the clearance rate for the same time last year was 60%.
The Melbourne property market will quieten down over the next two weeks due to next week’s AFL Grand Final and the commencement of Victorian school holidays. We will then enter into the ‘Spring selling season’ before it quietens down again mid December to late January.
The feedback that I am receiving regarding Spring stock levels is that the amount of properties coming to market will rise, but not as many as the selling agents would have hoped for. Many investors that had planned on selling have already done so. So that leaves owner occupiers and most are only selling due to personal circumstances, that being either divorce, death or financial pressures. It is looking like demand for property will continue to outstrip supply for quite some time and there will be a continuation of pressure on Melbourne’s property prices.
The RBA are due to meet again at the end of this month and it is looking likely that interest rates will remain on hold due to inflation rising and the unemployment rate declining in July. This should help prevent the Melbourne property market going into any strong price growth and allow it to continue to grow at a slow and steady pace (which is much more sustainable).
Have a great week
Kim Easterbrook – Managing Director
Hi,
The Domain Melbourne auction clearance rate was 73% over the weekend with 834 auctions reported, 604 properties selling, 166 passing-in and 64 were withdrawn. In comparison, the clearance rate for the same time last year was 61%.
Over the past few weeks, there has been a lot of discussion regarding Melbourne property prices with many sources predicting an increase in the median house price for the remainder of 2025 and for 2026.
- KPMG predicts Melbourne house prices will rise 5.2% in 2025 and 6.6% in 2026 with unit prices to rise 4.4% in 2025 and 6.1% in 2026.
- Domain is predicting a 6% median house price increase and 5% median unit price rise in 2026.
- Westpac’s latest property forecast predicts a 4% rise in median house price this year and 10% in 2026.
Melbourne is leading the charge with predictions of long awaited price increases materialising as confidence in the property market builds at a quick pace.
The reasons for this is due to many factors including falling interest rates, increased buyer confidence, increased interest from investors (in particular interstate), population growth, construction slow down due to higher building costs, and Melbourne property prices not rising for many years due to Covid lockdowns and as a result, is now more affordable than many other capital cities in the country.
I attended multiple auctions on the weekend, all selling under the hammer, but one to mention is the huge result at 6 Bowen Street, Hawthorn. The four bedroom, two bathroom, one car park updated period home was quoted prior to auction for $2,200,000 to $2,400,000. Five bidders participated in the auction with the property being announced ‘on the market’ around $2,550,000 (but could have hit the reserve prior to that due to the momentum of the auction) with the final sale price being $2,920,000.
Have a great week
Kim Easterbrook – Managing Director
Hi,
The Domain Melbourne auction clearance rate was 73% over the weekend with 749 auctions reported, 547 properties selling, 124 passed in and 78 were withdrawn. In comparison, the clearance rate for the same time last year was 60%.
Buyers braved the freezing conditions over the weekend and there were strong attendances at many auctions. Interestingly, we had four auctions on Saturday with two of them passing in, one selling exactly where it should have and the other was a runaway result. This is what we are witnessing all across Melbourne. Mixed results but most properties selling, even after it passes in. This just means vendors have needed to adjust their price expectations and meet the market.
However, we are noticing more and more runaway results and some sale prices have been very high. A two bedroom house in Albert Park sold $600,000 over reserve, another home in Williamstown sold $515,000 over the top of the quoted price range with six bidders, a house in Bayswater sold more than $260,000 over reserve with 7 bidders, a house in Frankston sold $260,000 with five bidders and the list goes on.
As confidence grows in the Melbourne property market, so does to the amount of buyers willing to transact, which has dramatically increased since last year. That being said, there are still a number of buyers who are sitting on their hands and waiting until next year to buy. My feeling is that these buyers might miss an opportunity as prices rise. Currently, we are seeing a mixed bag of results, some high prices but the odd good buying opportunity is still presenting itself.
Have a great week.
Kim Easterbrook – Managing Director
Hi,
The Domain Melbourne auction clearance rate was a strong 75% on the weekend with 721 auctions reported, 543 properties selling, 125 passed in and 53 were withdrawn. In comparison, the clearance rate for the same time last year was 60%.
This was a solid result considering the auction numbers were higher although results are still somewhat a mixed bag. Properties that have no compromises are selling very well but properties that are compromised in some way are somewhat price sensitive.
I attended three auctions on Saturday of which two passed-in and one sold $200,000 over reserve. The property that sold $200,000 over reserve was a two bedroom, one bathroom unit on its title with no shared driveway in a great location. This had two older couples really stretching to try and secure it.
The other two that passed in were both in A Grade locations (one in South East and the other Inner North), one whilst liveable, neat and tidy, needs a structural renovation and the other had rectifiable issues with the floors. That being said, both auctions still attracted multiple bidders but the interested buyers were price sensitive as they needed to factor in work, and vendors needed to lower their expectations to sell, which they all did. Both properties sold immediately after the auction.
My feeling is that the property market is still somewhat price sensitive unless a property is ticking all the boxes. That means, A grade location, quiet street, close to shops and transport, good floorplan, in very liveable or renovated condition. Affordability is coming into play and buyers generally just don’t have the capacity to push their budgets like they used to when interest rates were lower. It will take a few more interest rate cuts I believe to ease this pressure. In the meantime, property prices are likely to continue to steadily increase as buyer demand and confidence rises.
Have a great week.
Kim Easterbrook – Managing Director
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
Hi,
Domain’s preliminary Melbourne auction clearance rate for the weekend has come in at 73%. 552 auctions have been reported, 402 selling, 41 withdrawn and 109 passing in. As a comparison, the Domain clearance rate was 61%.
Tomorrow, the Reserve Bank of Australia will announce whether they intend on cutting interest rates after the surprise ‘rates on hold’ announcement last month. The board wanted to see the result of the ABS’ inflation data for the June quarter before making a decision, which was released at the end of last month. Inflation fell to 2.1% and ‘trimmed mean’ fell to 2.7%. This confirms inflation is under control and whilst unemployment remains low, it did rise in June from 4.1% to 4.3%, this ‘should’ be enough for the RBA to decide to reduce interest rates. And if not, I believe there would be a huge uproar from mortgage holders.
What does this mean for property prices? Interest rate cuts historically result in increased confidence the property market which inturn results in property price growth. There are more people attending open for inspections, more buyers bidding at auction and we are currently seeing slow and steady property price growth in Melbourne.
Some interesting data released from KPMG last week suggests that the Melbourne property market will be the top-performing city for property price growth in 2026 finally ‘waking up’ from the pandemic. They also believe due to affordability issues, that units might outperform houses. There is no argument that affordability will come into play with long term property performance and due to Melbourne’s housing market being unaffordable for many, this also may mean that more people move to regional areas that are a commutable distance to Melbourne such as Geelong.
Have a great week.
Kim Easterbrook – Managing Director
