March makes a full recovery from Covid
In March the Real Estate Institute of Victoria (REIV) recorded more than 4,043 auctions. 3,003 properties sold, 2,343 at auction, with 576 passed in. 652 properties were sold before auction & 8 property was sold after auction. The clearance rate averaged 83%, slightly down on February’s 86.5%.
The surging Melbourne market has finally regained the full 6.1% drop in home values caused by the emergence of the pandemic in 2020. In fact, according to analysts CoreLogic, the median home value now of $736,478 is 0.6% higher than the previous market high in early 2020. And the rises are set to continue with the median forecast to lift by another 10%, that is, about $70,000, before the start of 2022.
Low interest rates and savings in the driving seat
Low interest rates are driving the national boom. Plus, with no international vacations and curbed domestic holidays, people’s energy (and disposable income) is being channelled into home buying and upgrading.
Renters get the picture
The penny is dropping for many tenants who are finally realising mortgage repayment figures are not that different from what they are paying to rent. This has always been a nobrainer, but with interest rates both low and stable for the next couple of years, conditions are better for making those high commitment borrowing decisions.
Things look lively going forward
There are other factors that could add impetus to values in the middle term, at least for the upper end of the market. The real estate spring is tightening again and waiting to release.
As the vaccine rollout happens around the world plenty of ex-pats are queued up to return, bringing money for homes. Australia’s supercharged migration will resume again, raising that kind of housing demand. And even though the Chinese government is causing problems for Australia, it’s very likely cashed-up Chinese investors will jump back in the local market when international borders reopen.
Better to make your property moves now and avoid the rush!
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