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