Boom, or just a strong growth phase? Melbourne rolls on past a solid Winter.
August’s 4 weekends saw in excess of 3,041 auctions reported to the Real Estate Institute of Victoria (REIV). More than 2,129 sales were recorded. Approximately 730 properties were passed in with 361 of those on a vendor bid. The averaged clearance rate was 74.5%, down on August last year which was 77.5%.
Looking at Winter as a whole, auction clearance rates have now averaged 75.1% across the coldest months. 10,046 weekend auctions were held this Winter, 24.4% higher and well ahead of last year’s 8073 . Boom is a word we’re hearing bandied about in the media but experienced real estate agents dismiss this term seeing the current market strength instead as a strong growth phase, driven by Melbourne’s rising population and economic conditions. Buyers are still showing some reserve, baulking at the higher expectations of some vendors.
Melbourne delivered an auction price median of $880,000 on August’s last Saturday, up from $822,500 (7% rise) for the same weekend last year and clearly showing the price growth in play.
New research (Red23) has revealed Indian-born buyers are emerging as a real force in Melbourne’s outer growth zones. 40% of land buyers in Melton, Wyndham, Hume, Casey and Whittlesea have been recent arrivals to Australia from India. Arriving to study, then acquiring residency, this cohort join the workforce and pretty quickly start the process of first home ownership or investment. It illuminates the key role Melbourne’s controversial education industry plays in migration to the city. Builder Dennis Family Homes builds new houses designed specifically for the Indian market, on Vastu Shastra principles, including a possible prayer (pooja) room conversion.
A notable sale in August was a tennis court in Toorak that went for $7.8 million, 2M above reserve. In Port Melbourne, ugly duckling housing commission homes on spacious blocks have become swans. Often on blocks twice the size (440 sqm) of nearby blue-chip zones, these tired homes are now rocketing in value. One in Williamstown Rd. sold on August’s last Saturday for $1,642,000, way over its $1.25 million reserve.
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