Hi ,
Melbourne’s auction clearance rate remained steady at 71% even after the RBA’s announcement of another interest rate hike. 724 auctions were reported to the REIV with 377 selling at auction, 150 before auction and 207 passing in. Interestingly, there were only 99 private sales recorded which is low for this time of year where off market activity is usually higher. In comparison, there were 802 auctions on the same weekend last year resulting in a clearance rate of 69%.
This week’s interest rate rise was another blow to mortgage holders however it should have come as no surprise. It was likely that we were going to see another before the end of 2023. What we weren’t expecting was that it is likely there may be another interest rate rise in December or February next year.
At this stage, the rate rise has had little effect on the auction clearance rate which has remained steady in low 70’s for a number of weeks. This reflects a balanced market. With rents rising, it is becoming more important that people have a roof over their head that they own and as a result, buyers are still transacting.
What might happen as a result is a drop in stock levels as some vendor’s are becoming increasingly cautious about selling their property in a market with rising interest rates. I have heard numerous reports of vendors who were thinking about launching their properties this week, now holding off until February. On the flip side of this though, we might see another flurry of investors selling their properties to cash in their equity and pay debt their owner occupied debt. This will as a result put further pressure on rental prices.
Population growth and demand though is holding prices high and I believe will continue to do so. Whilst we have high levels of immigration, it is highly unlikely we will see any sort of housing crash due to rising interest rates.
A couple of auction results from the weekend, one being 20 Fairy Street, Ivanhoe. A property that sold well above reserve but one that was special and rare due to its location. The property was located in one of the best streets in the area and in a very tightly held pocket. The four bedrooms, two bathroom property was quoted at $2,800,000 – $2,900,000 prior to auction. A large attendance at the auction with a number of bidders not putting up their hand. Three bidders drove the price to $3,470,000 which sold approximately $500,000 above reserve.
A three bedroom townhouse in Port Melbourne was in demand with the well presented, three bedroom, two bathroom, one carport property attracting three bidders at its auction. The property sold for $1,605,000 which was $105,000 above its reserve.
Have a great week!
Kim Easterbrook
Gold Coast Property Market Update
There is still plenty of activity at open for inspections for both houses and apartments on the Gold Coast. Unlike the southern states, the demand for apartments is high as there are many buyers looking to have an escape from the colder winters down south thus purchasing an apartment to enjoy the mild winters offered on the Gold Coast. Broadbeach to Burleigh Heads proving to be popular destinations.
Northern Gold Coast suburbs like Helensvale, Coomera, Pimpama, and Ormeau are expected to be the most sought-after in 2024 for houses. With a median house price of $1.08 million in Helensvale and an array of local amenities, such as Westfield Shopping Centre and excellent transportation links, these suburbs offer promising investment potential.
According to CoreLogic, Brisbane and Gold Coast property prices have had strong growth increasing by 3.8% for the September quarter.
The Gold Coast property market, which is closely intertwined with the local employment market, has had and will continue to have a significant impact on the Gold Coast housing supply. The growth of key industries such as tourism, hospitality, health care, construction, and the film industry has created numerous job opportunities, which in turn has driven demand for housing and influenced property prices.
Jenni Wright – Senior Buyer’s Agent (Gold Coast)
Hi ,
Melbourne’s auction clearance rate remained steady at 72% over the weekend which is a positive sign for the property market as it was a ‘Super Saturday’. 1,082 auctions were reported to the REIV with 555 properties selling at auction, 224 sold before auction and 303 passing in. In addition, there were 178 private sales. The same weekend last year produced a clearance rate of 72% on 480 auctions.
All signs are showing that the Melbourne housing market has turned the corner with multiple data tracking resources suggesting that Melbourne’s house prices marginally rose in September off the back of a small rise in August. CoreLogic’s data is showing Melbourne’s property prices increased 0.4% in September and overall rose 1.3% for Q3 2023. They have also suggested that Melbourne property prices have risen 4.3% since the property market bottomed out in December 2022.
This does not apply to all segments of the market with renovated houses leading the charge and apartments falling behind. However, the averages are suggesting that we are back in a slow but steady rising market. This will likely slow down temporarily after the predicted interest rate rise next week. Historically, we experience a week or two of uncertainty until buyers get their head around the new interest rate and feel confident enough to buy. I have no doubt the start of November will likely be the same.
We are seeing more properties passing in at auction after active bidding. This means that vendor’s reserves have not been met and they have to lower their expectations in post auctions negotiations in order to achieve a sale.
However, this was not the case at 18 Tennyson Street, Richmond which attracted strong competition at auction. Renovated warehouse conversions are in very high demand and this property was no exception. The three bedroom, three bathroom property was quoted for $2,550,000 – $2,700,000 prior to auction and selling for $430,000 over reserve for $3,130,000.
Have a great week!
Kim Easterbrook
Hi ,
Melbourne’s auction clearance rate dropped for the second week in a row to 72%. This is the lowest clearance rate we have seen for quite some time. 381 properties sold at auction, 144 sold before, 3 sold after auction and there were an additional 115 private sales.
Whilst some vendor’s believe Spring can be the best time to sell, the increase in stock generally gives buyers more choice. The next 10 weeks leading into Christmas should bring some better buying opportunities for property buyers. Both vendors and selling agents are usually very keen to sell their properties before Christmas Day which is a deadline that can work in buyers favour.
A predicted interest rate rise may also temporarily add a little bit of uncertainty into the property market. History has shown us that with every interest rate rise, there is a week or two of increased uncertainty until buyers become accustomed to the new interest rate. We have all known another rise was highly likely before the New Year so this should not be shock to anyone.
The Melbourne Property Market does feel similar to the Spring season last year where the conditions eased and there were more buying opportunities. If history repeats itself though, the Christmas break will be a good reset for buyers who came out in force in February.
Have a great week!
Kim Easterbrook
Geelong Property Market Update
Stock levels for houses in the $700,000 to $1,000,000 are low and there is a continuation of a strong buyer pool for these homes with competition pushing prices beyond current market values.
KPMG chief economist Brendan Rynne has predicted that Geelong will have three new $1m by 2025 being Geelong, Geelong West and Highton. He believes the increase in demand will drive this as a result of increased migration, predicted interest rate cuts in 2025, lending conditions may ease, renters being pushed out of the rental market (due to increased rents and lack of supply) and demand from overseas investors.
Geelong is still seeing an increase in Melburnians moving to the area due to lower priced housing and flexible working arrangements being able to work from home a few days a week. This migration will likely to continue well into the future.
7 Janmar Court, Grovedale is a modern, three bedroom, two bathroom home that was recently listed for sale at $769,000 to $799,000. The property sold after one open for inspection and multiple buyers seeking to secure the home.
Another property that sold quickly was 7 Victoria Terrace, Belmont. The 3 bedroom 1 bathroom home on 558 sqm was quoted for $900,000 to $950,000 prior to auction and sold for $1,060,000.
Vicky Whittaker – Senior Buyer’s Agent (Geelong and Regional Victoria)
Hi ,
The Melbourne auction clearance rate dropped slightly to 74% over the weekend with 638 auctions being held across the city. 355 sold at auction, 116 sold before auction, 1 sold after auction and 166 passed in (83 of those on a vendor bid). In comparison, the same time last year there were 602 auctions held resulting in a clearance rate of 71 percent.
The REIV has released its September quarter 2023 median prices and it shows that for the first time since the June 2021 quarter, houses and units across Melbourne (being inner, middle and outer rings) all recorded growth. In regional Victoria, both houses and units remained stable and recorded no quarterly change. Statewide, the median house prices were up 1.3 percent and units up 1.8 percent.
This data confirms what we are seeing on the ground with active bidding at most auctions we are attending. Renovated houses are still performing well but we are getting a sense that the demand for unrenovated properties is on the rise again. Villa units are a very strong segment of the market with high demand for properties with a little bit of land. Apartments are still suffering from the Covid hangover but from a rental point of view are in high demand from tenants as the supply continues to dwindle due to landlords selling.
My team attended many active auctions on the weekend including 3C Manuka St, Bentleigh East which was quoted at $1,100,000 to $1,200,000 prior to auction. The property is a modern four bedroom, two bathroom townhouse but located a long way from public transport and a shopping strip. It demonstrates that some buyers will put space and condition above location when selecting a property. The auction attracted five bidders and the property sold for $1,385,000 on a reserve of $1,100,000.
22 Banool Road, Surrey Hills was also a popular property and attracted very active bidding at the auction. The well presented four bedroom, two bathroom home was quoted at $1,900,000 to $2,090,000 prior to auction. The property was announced on the market at $2,000,000 in front of a huge crowd of almost 150 people. Six bidders in total pushed the selling price to $2,405,000.
Have a great week!
Kim Easterbrook
Hi,
The clearance rate held strong on the weekend with over 741 auctions being reported to the REIV resulting in a clearance rate of 78%. This has improved on last year’s clearance rate of 69%. Interestingly, the REIV are reporting that there were 2,404 auction sales in September 2023 which was a 37% increase from September 2022 and the sixth highest September on record for the number of auction sales.
All signs are indicating that the property market has stabilised and property prices could be heading upwards with very active bidding over the weekend and a general sense of positivity. Whilst I don’t read into anything the media has to say about the property market, some buyers do and there were many reports out last week indicating the property prices are on the rise again. This will give some buyers confidence that now is the time to buy. On the flip side of this though, stock levels are on the rise for the Spring season so we should have an active, stable market for the rest of the year.
However, there is bad news for tenants with Corelogic just releasing their Quarterly Rental Review for July to September 2023 and Australia’s vacancy rate fell to record levels at 1.1% for September. Melbourne’s overall vacancy rate is now sitting at 0.8%. With some landlords selling, the total count of national rental listings fell to its lowest level in almost 11 years.
There were plenty of hands in the air on the weekend with active bidding at many auctions. 9 Soudan Street, Malvern went to auction which is a four bedroom, one bathroom double fronted period home on 465sqm of land, in need of a full makeover. The property was quoted at $2,200,000 to $2,300,000 prior to auction and the bidding was slow to start. In the end though there were five bidders and the property sold well above its $2,375,000 reserve for $2,475,000.
It seems buyers weren’t afraid of bidding for unrenovated properties with 42 Davis Street, South Yarra also going under the hammer. The inner city house has four bedrooms, two bathrooms and is on 499sqm of land with a pretty facade. The property sold for $5,250,000 on a reserve of $4,500,000.
On the other side of town, a renovated, three bedroom, one bathroom home at 91 Chirnside Street, Kingsville went to auction. The property was quoted at $1,250,000 to $1,300,000 and sold well above the range for $1,455,000.
Have a great week!
Kim Easterbrook
Hi,
The clearance rate improved this week resulting in 76% of properties going to auction selling (as reported by the REIV). There were 726 auctions with 411 selling, 143 selling before auction and 172 passing in. In addition, there were 112 private sales. The same weekend last year was Grand Final weekend with 103 auctions reported producing a clearance rate of 80%.
Last week, the Andrews Government announced that as of the 1st of January 2025, there will be a new tax of 7.5% on short stay accommodation. This tax is calculated on the total revenue not profit. The purpose of the tax is to discourage landlords from turning their properties into holiday accommodation and to encourage them to list them on the long-term rental market. There are currently 36,000 short-stay properties in Victoria and whilst this may help to increase a small amount of supply, it is unlikely to have the effect the Government believe it will. Some properties are simply not set up to be long-term rentals but mostly because many short term rentals are actually holiday homes that people lease out when they are not occupying themselves.
This is just another cost to investors (on top of increased land tax, new compliance legislation and now new laws being introduced to protect renters rights). The Government should be looking at ways of encourage people to invest in properties rather than making it harder and more expensive for landlords. Some landlords are selling up, which will have the reverse effect and will decrease supply and result in higher rents for tenants.
Our team attended some very competitive auctions over the weekend with villa units and renovated houses continuing to be in very high demand. 25 Woodlands Drive, Cheltenham is a three bedroom, one bathroom villa unit on 347 sqm of land. The property was quoted $790,000 to $820,000 prior to auction. In front of a huge crowd, five bidders participated in the auction with the property property selling for $995,500 which was $140,000 over reserve.
On the other side of town, the auction of 9 Maxwell Street, Northcote attracted very competitive bidding. The renovated, three bedroom, two bathroom period home on 537 sqm was quoted at $1,900,000 to $2,050,000 prior to auction. The auctioneer starting the bidding at $1,850,000 but four genuine bidders in total participated with the property selling for $2,481,000 which was $431,000 over reserve.
Have a great week!
Kim Easterbrook
Hi,
As reported to the REIV, the clearance rate slightly dropped over the weekend to 73%. 618 auctions were held of which 451 properties sold and 167 passed in. 86 of these passed in on a vendor bid. The next two weeks will be quieter for both new listings and auctions due to the football finals and school holidays with a very minimal amount of auctions being scheduled for the AFL Grand Final weekend.
We are currently in a two-speed market where houses are generally selling under strong competition. If the property is renovated, well located, has a good floorpan and a sizeable backyard, these are the ones that are most highly sought after. If the property needs some work, some buyers are still a little reluctant to pursue these due to the unknown in what the renovation will actually cost. Overtime, as building costs stabilise, this should start to turn with more buyers willing to purchase them.
Villa units, due to the entry level price point for a property with some land are performing really well, and are under strong demand. We believe this will continue to the be the case into the future. Good quality apartments (being large, renovated, well located, with car parking) are selling well but apartment buyers are particularly fussy at the moment due to the increase in stock on the market and the choice available.
42 Chivalry Drive, Glen Waverley went to auction on the weekend and was quoted $1,350,000 to $1,450,000 prior to auction. Strong bidding by 5 parties with almost all of them being Chinese buyers (a busy segment of the market again) with the property selling for $1,707,000. The property was announced on the market at $1,700,000 however it is likely the auction had reached the reserve prior to this.
22 Percy Street, Hawthorn was another popular property that went to auction on Saturday. The pretty four bedroom, two bathroom, two car park renovated Victorian was quoted for $2,700,000 to $2,900,000 prior to auction and attracted three bidders at the auction. A strong opening bid of $3,000,000 no doubt knocked out some other potential buyers from the auction. The property sold under the hammer for $3,270,000.
Have a great week!
Kim Easterbrook
Hi,
Auction numbers for September are at healthy levels with 670 auctions being reported to the REIV over the weekend. 379 sold at auction, 130 sold before auction and 161 passed in resulting in a clearance rate of 76%. There were an additional 223 private sales. In comparison, for the same time last year, there were 702 auctions producing a clearance rate of 70%.
National Cabinet has put out a response in regards to Australia’s housing crisis pledging to build 1.2 million new dwellings over a five year period commencing 1st of July, 2024. All sounds great in theory, but in reality, it’s a target that is likely to be impossible to achieve.
An article by Leith Van Onselen in marcobusiness.com.au summarises it well but some main points as follows. According to the OECD (Organisation for Economic Co-operation and Development), Australia is already building more houses per capita than most countries (that are part of the OECD) with Australia’s 40 year average home construction pace being 160,000 per annum. National Cabinet has set a target of 240,000 per annum and the most the country has ever built in one year is 223,000 in 2017.
Interestingly, the Governments (Federal and State) are hoping to achieve these targets through developers with easing planning and zoning laws to allow for greater density. The Albanese Government’s contribution is set at 30,000 dwellings which is only 2.5% of the total target.
On the demand side, immigration is putting huge pressure on the housing market, both for buying and renting. Australia’s population is predicted to grow by 2.18 million people over the next five years of which 1.5 million is predicted to be from immigration.
With no financial incentives for developers to build more, construction costs sky high and profit margins low, it seems an impossible target that the amount of homes needed to keep up with housing demand will be achievable. Developers will not want to flood the market with stock as their incentive to build projects is to make money. Flooding the market will diminish profits.
With an unattainable supply plan and without a fix on demand, property prices and rents will likely to continue to rise as demand continues to outstrip supply.
14 James Street, Surrey Hills went to auction over the weekend. The auction of the unrenovated, three bedroom, one bathroom home on 623 sqm attracted 3 bidders at auction. The auction was very slow and the bidding commenced on two vendor bids, $1,800,000 and $1,825,000 until one party jumped in. The property ended up selling for $2,162,500 with the property being announced on the market for $2,000,000.
In Geelong, an ex commission house went to auction which required a lot of work (was unliveable) but the property was on 624 sqm of land. The auction of 19 Irwin Court, Whittington attracted 4 bidders with the property announced on the market for $350,000 and selling for $385,000.
Have a great week!
Kim Easterbrook
Hi ,
Auction numbers decreased this week with 676 auctions reported to the REIV resulting in a clearance rate of 74%. 365 sold at auction, 135 sold before auction and 176 passed in. In addition there were 136 private sales. Similar numbers on the same weekend last year with 661 auctions reported to the REIV and a clearance rate of 72%.
The Reserve Bank is due to meet again tomorrow and many are predicting interest rates will remain on hold. Some Economists are suggesting that we may actually have reached the peak and interest rates may start to come back down next year. Once we have reached interest rate stability this will result in an increased number of buyers in the market as confidence in the property market grows. This however will be needed to balance out the market if stock levels are predicted to rise as what has been suggested. The apartment and villa unit market could be have a short term surge in listings as landlords offload their investment properties.
Coming into next year though, stock levels are likely to come back down as the vendors who have been sitting on their hands and vendors under financial pressure would have sold. If you are thinking of buying, this Spring season may offer opportunities that we may not see again. The growing confidence in the property market added to population growth may encourage property prices to go up again in 2024.
Some strongly contested auctions on the weekend including 59 Gooch Street, Thornbury went to auction on Saturday and the two bedroom, one bathroom, structurally renovated terrace home was popular at auction with five bidders trying to secure the property. The property sold for $1,291,000 which was $171,000 over the reserve price.
A family home in Camberwell was also in strong demand with four bidders participating in the auction. The property had a price guide of $3,500,000 to $3,800,000 and sold for $4,515,000 after being announced on the market at $4,100,000.
Have a great week!
Kim Easterbrook
Hi ,
We are very excited to announce that Elite Buyer Agents has expanded to the Gold Coast being managed by Senior Buyer’s Agent, Jenni Wright. Jenni, a highly experienced Buyer’s Advocate, has been in real estate for over 27 years and loves to navigate the “in demand” Gold Coast property market with complex negotiations and low stock levels. We are thrilled to be able to expand our services further across the country and welcome her back to the Elite team.
Melbourne Property Market Update
The clearance rate dropped slightly over the weekend with 706 auctions reported to the REIV. 394 properties sold at auction, 133 sold before auction and 179 passed in. There were an additional 276 private sales. We are experiencing steady clearance rates in the 70%’s week in, week out, but this week, the amount of sold properties increased both by auction and private sale. In comparison, for the same weekend last year, 649 properties went to auction resulting in a clearance rate of 69%.
The Spring season is predicted to be a busy one. This Saturday is a super Saturday with more than 1,000 auctions scheduled and more than 3,000 homes scheduled to go to auction over the next 3 weeks. REIV figures are suggesting that the record for the amount of auctions in the first week of September, which was set in 2015, of 932 auctions will be broken.
The higher stock levels are due to some vendors now having confidence that the property market is stable (even with all of the interest rate rises) so have decided now is the time to put their property on the market. In addition to this, there will be a short term spike in rental properties coming onto the market with some landlords making the exit from investing in property. Some owner occupiers will be offloading their properties due to the unaffordability of increased mortgage repayments. And naturally vendors feel Spring is the best time to sell due to improved weather and their properties/gardens generally looking better this time of year.
Now could be as good time as ever to purchase a property as the spike in listings will likely be short term. The property market is expected to stay balanced as buyers are also building confidence that interest rates are near the peak and it is expected that the rental market could become extremely tight and rents ‘should’ be on the rise as well.
The villa unit market is a strong segment of the market due to buyers having decreased budgets as a result of rising interest rates. Villa units can still offer good accommodation, a backyard (but are on a subdivided block) at a more affordable price point of $1m (give or take a little).
6/39 Brownfield Street, Mordialloc is a three bedroom, one bathroom, double garage modern unit which was quoted at $850,000 to $935,000 prior to auction. The bidding opened strongly at $980,000 which knocked out most of the buyers there to bid. The bid however was challenged by 2 other parties but the originally bidder successfully purchased the property for $1,010,000.
4/12 Florence Street, Surrey Hills was another villa unit that performed well at auction on the weekend. The updated two bedroom, one bathroom, double garage villa unit was quoted at $800,000 to $880,000 prior to auction. An offer of $960,000 was acceptable to the vendor prior to auction so the auction was brought forward. There were four bidders who challenged the offer with three of the bidders over $1,100,000. The property sold for $1,170,000.
The higher end of the market is still actively transacting but facing the challenges of limited stock. The most expensive sale reported in Melbourne last week was a three bedroom, four bathroom apartment in Toorak which sold for almost $8,500,000.
Have a great week!
Kim Easterbrook
Gold Coast Property Market Update
Hi ,
I am very excited to bring Elite Buyer Agents to the Gold Coast and help both both owner occupiers and investors in purchasing property in what is a very different property market to Victoria.
Selling agents generally do not quote property prices on property which means for buyers, it can be very easy to overpay when negotiating a property purchase. That is why it is important to have representation from a Buyer’s Agent who understands the value of property and has local market knowledge.
There is strong demand for property on the Gold Coast which is largely driven by migration both internally (from other states around the country) and externally (from overseas). It is predicted that the population is to double over the next 20 years to over 1,000,000 people.
Many people are moving to the Gold Coast for the warmer weather and more relaxed lifestyle. The quality and ease of accessing medical care is also a deciding factor, as is the emergence of many fine dining restaurants, theme parks and the work from home experience.
In some areas of the Gold Coast, it is still possible to purchase a house for under $1,000,000 which makes it much more affordable than areas of Melbourne and Sydney. Waterfront properties are also of strong interest and are possible to purchase sub $2,000,000. The apartment market in Surfers Paradise and Broadbeach are popular for Investors, empty nesters and young couples. Due to the lack of available rental properties, rental yields on the Gold Coast are generally higher than what capital cities such as Melbourne and Sydney achieve. All markets are underpinned by the lack of stock, especially anything with a water view which is the Gold Coast is famous for.
Have a wonderful day.
Jenni Wright – Senior Buyer’s Agent
