Hi,
According to Domain, the Melbourne’s auction clearance rate reached the highest levels since May 2023 which shows the property market is improving and buyer confidence is growing. There were 658 auctions reported to Domain with 491 selling under the hammer, 97 passing in and 70 were withdrawn resulting in a clearance rate of 75%. The same weekend last year achieved a much lower rate of 57%.
The Melbourne property market is in recovery mode and property prices have increased for five consecutive months in a row (according to Proptech). This is likely to continue as interest rates slowly decline further which is widely predicted.
The latest inflation data suggests that inflation is coming down faster than expected with the latest results for the month of May coming in at 2.1% which is a decrease from 2.4% in April. Trimmed inflation (this excludes the most volatile components in the CPI) was 2.4% in April down from 2.8% in April.
The RBA are due to meet next week and many are expecting an interest rate cut to happen in July rather than August. Many are predicting that there could be another 3 interest rate cuts this year which will likely result in further increase in property prices.
More and more auctions are now attracting multiple bidders. The auction of 29 Forest Street, Collingwood gathered interest from multiple parties. It is three bedroom, two bathroom home with no car parking and located very close to Alexandra Parade. The price guide was $1,520,000 to $1,580,000 which was raised from $1,450,000 to $1,550,000 prior to auction. The bidding started at $1,500,000 and the property sold for $1,650,000 under the hammer.
Have a great week.
Kim Easterbrook – Managing Director
Hi,
The Melbourne auction clearance rate slightly dipped on over the weekend to 69% on 867 auctions reported to Domain. 456 sold at auction, 142 passed in and 67 were withdrawn. As a comparison, the clearance rate for the same weekend, last year was 62%.
Over the past two years many property investors sold their investment properties due to rising holding costs. Now it appears the table is turning, interest rates are coming down, vacancy rates are still low and rents are continuing to rise. The latest data from SQM research shows that rents in Melbourne rose 3% over the past twelve months… (2.3% for houses and 3.4% for units) and vacancy rates are stable at 1.7% in May 2025.
Many investors, in particular interstate buyers, are circling the Melbourne and are also looking at the Geelong property market as good options to buy. Melbourne has been sluggish in property price performance for a number of years and has become one of the most affordable capital cities in the country. That being said, it is still very difficult to buy a quality house (in established locations with good demographics) in rental condition under $1m (where it seems many investors are capped out in budget). Some investors are looking at other areas around Melbourne where it is still possible to buy a house but within a sub $1m budget.
Most property investors buy for capital growth and some for yield. Those looking for capital growth are hoping to purchase a property with land are having to look at alternative areas to Melbourne. Geelong (which is an easy commute to Melbourne) being one of those areas and for good reason. Population is predicted to increase by almost 50% over the next 20 years which will put huge pressure on housing supply for both home owners and renters. Due to the strong population growth and expansion of infrastructure and project approvals (another recently approved project is the $250M Viva energy gas terminal at Corio Bay) the city just keeps growing.
Some investors are looking at buying higher yield properties where CBD apartments are a higher-risk option (as rents have risen but prices have not) and other investors are looking at smaller properties such as villa units and apartments in the inner and middle ring suburbs to get into the Melbourne market. Many investors with budgets in excess of $1m are able to buy a house in the inner and middle ring of Melbourne and are trying to buy in before more interest rate cuts will likely push prices upwards.
We have also seen some investors moving to commercial properties where some properties have been achieving solid capital growth and slightly high rental yields. Also, there are benefits with commercial properties where the tenant pays for most of the outgoings and therefore reducing the ongoing holding costs.
There are many options when it comes to buying an investment property, and every buyer’s financial situation and goals are different so it is important to ensure you get the right advice (an experienced buyers’ agent or property advisor) to ensure you find the property that is the right fit.
Have a great week.
Kim Easterbrook – Managing Director
Hi ,
Lots of auctions over the weekend in Melbourne with reports of confident bidding and increased buyer activity. According to Domain, there were 737 auctions reported resulting in a clearance rate of 70%. The same weekend last year produced a clearance rate of 59%.
As we predicted, buyer activity in Melbourne has risen but stock levels have not. There is a lack of quality properties on the market and generally stock levels are low. This is not unusual for winter and we anticipate that to continue on until after the school holidays. Some vendors will be waiting to see evidence of property price growth in Melbourne and stronger clearance rates before putting their property on the market.
First home buyers are very active, as too is the ‘bank of mum and dad’. I missed out on securing a villa unit yesterday in the south east that had six offers on it (sold prior to auction above the comparable sales). Some good quality apartments in the inner city ring are also getting snapped up quickly with multiple offers and also are attracting multiple bidders at auction. Some buyers are feeling the pinch from higher interest rates and to enter into the property market, they are seeking entry level properties in quality suburbs.
The family home buyer market is still going strong (and quality family homes have been since Covid). A Fasham Builder home was under competition in Malvern on the weekend. The three bedroom, two bathroom, single level home on 696 sqm of land was quoted at the start of the auction campaign for $3,200,000 to $3,500,000 with the quote range lifting to $3,650,000 prior to auction. The property was announced on the market at $3,660,000 and sold for $4,000,000.
The big 4 banks have all predicted more interest rates to come but Westpac last week, announced they are predicting 4 interest cuts over the next 12 months. If this happens, this will likely add more pressure to property prices, particularly in Melbourne as the property market here has been so flat for many years now and is now one of the most affordable cities in the nation.
Have a great week.
Kim Easterbrook – Managing Director
Hi ,
The Domain auction clearance rate for last weekend came in at 70% on a very big auction weekend. 1,073 auctions were reported with 747 selling, 217 passing in and 109 withdrawn. In comparison, the clearance rate last year was 62%. In addition, the REIV have recorded 188 private sales. There won’t be many auctions this weekend coming due to the King’s Birthday public holiday.
Melbourne property was all over the news this morning with radio stations reporting “Melbourne is back”… “Melbourne property price gains leading the nation”. The confidence in Melbourne property is gaining momentum. PropTrack released data over the weekend that suggests Melbourne property rose $250 per day in May and it is the fifth month straight that home price growth has been in achieved in Melbourne. May was the biggest single month of growth for house prices since 2021. There are strong predictions now that Melbourne will surpass its previous record median price of $960,000 by the end of the year.
We have seen a significant increase in new buyer enquiry in our office from all sorts of property buyers being investors (mostly interstate), first home buyers, upsizers (family homes) and downsizers. Many of these buyers are still getting their finances in order and are not quite ready to purchase, but buying a property has become top of mind now for many. I am predicting slow and steady growth this year rather than any boom times as buyers are still cautious, but certainly more confident than before.
Have a great week.
Kim Easterbrook – Managing Director
Hi,
The Domain auction clearance rate for Melbourne over the weekend was 72% on what was a high volume weekend. 618 auctions were reported to Domain with 448 selling, 55 were withdrawn and 115 passed in. In comparison, the same weekend last year resulted in a clearance rate of 59%.
The Melbourne property market is slowly waking up and confidence is building. Over the weekend there were some strong auction results (albeit sporadic) and generally more bidders at auction. We haven’t seen any evidence yet of strong price growth yet… only marginal growth this year which suggests the market is stable.
There is usually a lag from the time there is substantial property price growth and the time it is recorded and reported. Many buyers don’t have the confidence to buy until they see evidence of price growth, which is when buyers can miss out on valuable capital growth in their assets.
We experienced an influx of interstate investors circling late last year and early this year before going quiet ahead of the federal election and Trump’s tariff war. Over the past two weeks, we have again received strong enquiry from interstate investors and with tomorrow’s likely announcement of an interest rate cut, many of these investors are motivated to buy now.
If you are considering buying a property in Melbourne or Geelong, I would suggest now might be as good as time as any. Historically, Melbourne has achieved strong capital growth and it has not been seen that for many years now. With interest rates coming down, population growing and buyers circling (particularly interstate investors), all signs are indicating we could see some reasonably property price growth this year.
Have a great week.
Kim Easterbrook – Managing Director
Hi,
Melbourne’s auction numbers increased over the weekend with 606 auctions being reported to Domain. 437 properties sold under the hammer, 58 properties were withdrawn and 111 passed in. In comparison, the clearance rate for the same weekend last year was 57%.
Firstly, in last week’s market wrap I reported that the Reserve Bank of Australia were due to meet last week to determine the outcome for the cash rate. This was actually incorrect and the RBA are due to meet next week, 20th of May.
Some banks have already started decreasing interest rates ahead of next week’s meeting which is welcomed relief to mortgage holders. Core inflation has fallen into the Reserve Bank’s target range for the first time in three years. Headline inflation remained steady in the March quarter at 2.4% and trimmed mean is at 2.9%, the lowest level it has been since December 2021. It is highly likely that the RBA will drop the cash rate next week, the question will it be 0.25% or 0.50%? Seeing the RBA’s cautious approach, one would think that 0.25% would be more likely with a wait and see approach.
Confidence appears to be building once again in the Melbourne property market but we have felt this stop/start approach many times over the past few years now. Earlier this year, we felt 2025 was going to be a very active year for property buyers and sellers and this came to a halt when Trump’s trade war started and then the federal election date was announced. With the recent school holidays and the federal election over, it feels it may have given the property market another reset and along with the imminent interest rate cut, more buyers seem ready to enter the property market. Investors are circling again (both local and intestate) and home buyers are getting ready to purchase as the fear of property prices going up soon is starting to set in.
Have a great week.
Kim Easterbrook – Managing Director
Hi ,
Over the weekend, Melbourne produced the strongest auction clearance rate in the country with a rate of 73%. This is the highest clearance rate we have seen since June 2023. Of 482 auctions reported, 350 sold, 47 were withdrawn and 85 passed in. Whilst the amount of auctions were lower due to the federal election, to compare, other weekends where auction numbers were lower (long weekends) have still only produced auction clearance rates in the low to mid 60%’s. The same weekend last year produced a clearance rate of 58%.
Like the election outcome or not, it is over and the uncertainty this creates because of the “uncertainy about the outcome” has now passed. Along with tomorrow’s predicted interest rate cut, we are anticipating this to bring some confidence back into the Melbourne property market. Interestingly, last week, we saw an increase in new buyer enquiry in our office, along with the increased clearance rate is demonstrating that we may be turning the corner.
PropTrack Home Price Index has been released and Melbourne is sitting just behind Adelaide in property price growth for 2025. Home values in Melbourne have increased each month so far this year and is demonstrating a good sign that we are well into the recovery of the Melbourne property market. Sydney, Brisbane, Canberra and Adelaide have higher median dwelling values than Melbourne which makes us one of the most affordable cities in the country. Melbourne is also experiencing significant population growth, (increased by 142,600 in 2023-2024), which is increasing demand for property and therefore Melbourne has become a very attractive place for property investors to buy.
Whilst this week’s interest rate cut will be welcomed by many, it will take one or two more interest rate cuts to really start driving property prices and therefore I believe still gives buyers some time and opportunity to buy well in the Victorian property market. We have had a great year of buying for our clients thus far and I still believe we have a window of opportunity left until property prices start to rise.
Have a great week.
Kim Easterbrook – Managing Director
Hi,
942 auctions were reported to Domain over the weekend with 601 selling under the hammer, resulting in a clearance rate of 64%. This is slightly less than last week being 66% on 1,065 reported auctions. The same weekend last year resulted in a clearance rate of 60%.
Even though the clearance rate is stronger than last year, the sentiment out in the property market feels very much the same. Trump’s trade war and the federal election has resulted in buyers cooling their jets somewhat on what had we all had thought was going to be a very good year in property. My feeling this will only temporary.
There has been a lot of talk about interest rate cuts over the past week with some economists and NAB predicting next month could be a 0.5% rate cut. Others predicting we could see interest rate cuts upto four or five times this year. Whatever it ends up being, it is almost certain we are not going to see interest rate rises for quite some time.
Peter Dutton announced yesterday that he is proposing to enable first-time home buyers to deduct interest payments of newly built homes from their taxable income for the first $650,000 of a mortgage. Labor has pledged to allow first home buyers to purchase a property with a 5 per cent deposit, avoiding the need for lender’s mortgage insurance. Both parties are looking at ways to help more buyers enter in the market which could further put pressure on property prices.
Whilst there is a lot of economic talk which could result is property prices rising, as at today, the sentiment is cautious and I believe now could be as good as time as any to buy. I have purchased five properties for my clients so far this month without including my team’s purchases. There are some exceptions to this of course which we have seen multiple buyers competing to secure a property, but the Melbourne property market overall is patchy and is opening up the door for some buyers to purchase a property they did not believe they would be able to within their budget.
This weekend there will be no auctions due to the Easter long weekend and the following weekend still quiet due to Anzac Day, however auctions will be back to normal from the 3rd of May.
Have a great long weekend and the market wrap will be back on the 5th of May.
Kim Easterbrook – Managing Director
Hi,
The Domain auction clearance rate came in at 64% on 997 reported auctions. 640 sold at auction, 236 passed in and a total of 121 were withdrawn. The clearance rate for the same time last year was 62%.
The property market continues to yield patchy results, with some properties doing extremely well with competition from multiple buyers, and others lucky to attract one bid/offer. The weeks leading up to a federal election often create some uncertainty which results in some buyers (and some vendors) sitting on their hands until after the election. Interestingly, Labor took proposals of changes to negative gearing/property investor tax consessions to the 2016 and 2019 federal elections which impacted property prices and sentiment across the country. This year there are no mention of any reforms that will impact the property market, yet the uncertainty of who will win, is enough for some buyers to just pause temporarily.
The good news though is that has created a small window for buyers to take the opportunity of less competition. There will be another Reserve Bank meeting tomorrow but it is unlikely any further relief in interest rates will come until mid year at a minimum.
We were successful in securing a family home at auction on the weekend and it is a good example of quality homes are in strong demand (and pretty much are in all property market conditions). The property ticked all the boxes, pretty period home, fully renovated, north facing rear, great street close to shops, cafe’s and walking distance to the beach. The auction was not easy though and we did have a fight on our hands to secure it. These rare homes almost always have strong competition to secure them and we were thrilled to have been able to purchase the property for our happy clients.
Have a great week!
Kim Easterbrook – Managing Director
Hi,
The Domain Melbourne auction clearance rate came in at 67% over the weekend on a what was a ‘Super Saturday’. Of the 913 auctions that were reported, 610 had sold at auction. This is stronger than the 61% clearance rate from the same time last year.
Whilst we are seeing increased activity in the Melbourne property market this year, at this stage reports and also what we are witnessing (generally speaking) there have been no increase in property prices. In many cases, properties are selling exactly where the value lies and buyers are still very cautious at what they are willing to spend due to the increased cost in mortgage repayments.
Uncompromised properties at various price points are attracting good interest, this may be family homes that are renovated, presented well, located on a quiet street, lots of natural light, or a villa unit in a small block of 2 or 4 which is located close to public transport and shops. Also well located apartments that have great outlooks, a good floorplan, well maintained small blocks are also attracting multiple bidders at auction, but again, runaway results are rare.
Feedback from many selling agents and also we can confirm we are witnessing the same, was that February was a strong month of activity mostly due to the interest rate cut but with the looming federal election and the uncertainly of Donald Trump’s tariffs that this has slowed somewhat.
I attended the auction of 3/110 Caroline Street, South Yarra which is a well located apartment, in an excellent block, nice northern outlooks, very liveable but could benefit of an update later down the track. The auction was very well attended with what looked like five or six parties there with intention to bid. A mix of single professionals, couples and what appeared to be some downsizers looking for a weekend, city pad. The property was quoted $740,000 to $760,000 prior to auction. The last one sold in the block for $757,000 which was arguably not in as good of position in the block. The opening bid was $768,000 and a second bidder came in straight away at $780,000 and the two parties went head to head where it sold for $855,000.
Have a great week!
Kim Easterbrook – Managing Director
