Melbourne auction market could not withstand the winter chill

The Melbourne market recorded its lowest non-holiday auction weekend result of the year so far, with signs that the typical winter chill in activity is now approaching. 14147852_l

Melbourne reported a clearance rate of 71.8 per cent on Saturday, which was still above the 65.8 per cent recorded over the previous weekend’s Queen’s Birthday holiday, but well below the 80.9 per cent reported over the same weekend last year.

High auction numbers may have contributed to Saturday’s lower result, with a June record of 988 homes listed to go under the hammer.

This was well ahead of the previous weekend’s 264 auctions and well above the 899 auctioned over the same weekend last year.

Although the Melbourne market overall recorded a year-low result on Saturday, a closer look revealed the eastern suburbs were the principal contributors to the weaker market activity. 

This continued a recent pattern of declining clearance rates from these areas, following a strong market-leading period of activity and prices growth over recent years.

By contrast, Melbourne’s lower-priced, northern and western suburbs continued to record strong results and are now clearly the mainstay regions of the market.

The most expensive property reported sold at auction was a four-bedroom home at 16 Chastleton Avenue, Toorak, which sold for $5,020,000 by Kay and Burton.

The most affordable property reported sold at the weekend was a three-bedroom unit at 63 Station Road, Melton South, which sold for $235,000 by Raine and Horne.

Melbourne recorded a median auction price of $800,000 on Saturday, which was higher than the $717,000 recorded the weekend before.

Saturday’s median was 2.4 per cent lower than the $820,000 recorded over the same weekend last year.

A total of $406.6 million was reported sold at auction in Melbourne at the weekend.

Saturday’s June record listings will be followed next weekend with another sturdy winter test for the market.

Up to 900 homes are set to be auctioned as sellers avoid the clash with the following weekend’s federal election.

Lower interest rates improving affordability and increased interest from investors will continue to fuel strong buyer demand for homes in Melbourne’s north and west – despite the winter chill.

For a full list of the Melbourne auction results click here

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Dr Andrew Wilson is Australia’s leading housing market expert. As senior economist for Fairfax-owned Domain Group, Dr Wilson is one of the nation’s most respected real estate analysts and Australia’s highest profile housing market commentator. Visit his blog at Domain

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