Units outshine houses in October.
Over the four weekends of October more than 3,784 auctions were reported to the Real Estate Institute of Victoria (REIV). 1,363 sales were recorded. Approximately 1,586 properties were passed in, 834 of those on a vendor bid. October’s clearance rate averaged 53% – sharply down on September’s 59%.
The trend so far in Spring shows Melbourne units are having their time in the sun, outperforming houses, with higher clearance rates and a tighter grip on value.
The clearance rate for houses over the last 8 weeks has averaged just 50.5%. Houses are still selling – but only with a lot more effort from agents.
However units have fared much better with an auction clearance rate of 58.7% (CoreLogic). Melbourne’s median house price dropped 4% ($35,000) over the last quarter and is now sitting at $852,980. But the median unit price over the quarter dropped by just 1.6% to $496,260 (Domain House Price Report). In many parts of Melbourne unit values are growing, and growing well.
Let’s face it, units are the great entry level opportunity for property ownership, especially when boosted by generous government incentives. First-home buyers are currently surging into affordable property right now and have become one of the main drivers in the otherwise unsettled market. Millennial’s have finally worked it out – save hard for several years, take advantage of generous grants, and take the ice-plunge!
Also, Real Estate Agents have identified good buying conditions currently for some upsizing home buyers. That is, moving from the under $700,000 range (which has a good supply of buyers) up to the above $800,000 – 1 million range, where values have softened. These up-sizers have the advantage of selling in a sellers’ market and buying in a buyers’ market.
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