March sees strong market, plus dramatic new Govt measures.
Over March’s 4 weekends there were in excess of 3,575 auctions reported to the Real Estate Institute of Victoria (REIV). More than 2,899 sales were recorded. Approximately 676 properties passed in with 299 of those on a vendor bid. The clearance rate averaged 80.5%, way up on March last year at 75.5%.
Melbourne’s remarkably strong sellers market powered on in March with high listings, high clearance rates and high prices. Melbourne’s summer market (Dec to Feb) broke the record for auction sales with close to 5,600 homes sold.
The North continues to boom with a clearance rate consistently around 90%. Many of Melbourne’s fringe areas are seeing stronger price growth than blue chip suburbs, as people look for value further out. March saw the continued trend of rising values in suburbs adjacent to the blue-chips. For example Ashburton next to Camberwell had its first 3M home sale in March.
More ‘bubble’ talk from the OECD failed to turn heads in Melbourne and Sydney but the Vic State Govt has introduced a raft of radical new initiatives as stimuli for affordability and housing supply, including:
– First Home Buyers waiver on Stamp Duty for homes under $600,000.
– Development maximum of 2 dwellings per property has been dumped for many middle ring zones. Developers will now be able to build multiple dwellings in these neighbourhoods, as long as the development provides a modicum of garden space.
– Investors have lost the ‘Off the Plan’ Stamp Duty Concession.
– Off the Plan Investors will also be hit by a 16% purchase tax.
– Vacant (investment) dwellings will be taxed 1% on capital improved value.
The most dramatic change is the new subdivision rule for middle ring suburbs, which will cause dramas in leafy streets in suburbs like Doncaster, Hampton and Glen Waverley as protective residents see established houses and gardens tumble as multi unit developments go in.
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