Cooling market hits inner-east the hardest.
Over July’s 4 weekends more than 2,147 auctions were reported to the Real Estate Institute of Victoria (REIV). More than 962 sales were recorded. Approximately 717 properties were passed in, with 329 of those on a vendor bid. July’s clearance rate averaged 62.25% – just up on June’s 61.2%.
The trend of cooling home values in Melbourne continued with averaged values dropping by .3% in July. Over the June quarter the drop was 1.4% (according to CoreLogic).
But Domain Group’s figures claim a sharper drop of 2% for the June quarter, putting Melbourne’s median house value at $882,000.
But both parties agree on one thing – the inner east is taking the biggest hit. Domain claims the Balwyn/Kew/Hawthorn zone has seen a drop in values of 8.4% over the last 12 months.
It’s much brighter for outer suburbs though with house values in Melbourne’s north-east, outer-east and north-west lifting by 2% over the June quarter.
Clearance rates are continuing to sit low in the cooler market. Home buyers are more reluctant to bid at auction hoping to get a low sale price in after auction negotiations. This can backfire however as it’s the last bidder who is in the strongest position to begin negotiations.
In current market conditions ‘dump sells for a fortune’ stories are rare but St Kilda is always a contender and scored one on July’s last weekend when a property just uphill from the Esplanade Hotel sold for $1.926 million. The land value was $6,075 – believed to be a new suburb record. This may be a roll-on of the ‘Gatwick effect’ – a revitalisation of the precinct following the closure of the notorious boarding home.
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