June 19, 2013
by Antony Bucello & Catherine Cashmore from National Property Buyers - 16 June 2013
Once again, Melbourne is producing robust results with the clearance rate ‘year to date’ now residing at 70 per cent (up from 68 per cent in April) and the latest REIV house price index posting a 1.4 per cent increase for the month of May.
According to the REIV, this is the eighth consecutive month of ‘house price’ increases, with unit prices also showing a moderate boost – up 0.9 per cent for the month – which is the third consecutive monthly rise.
Not surprisingly, the biggest gains have been recorded in the inner and middle regions of the city – principally, the ‘auction dominated’ terrains – with the outer suburbs remaining stable.
When confidence improves and auction results start to ‘openly’ surpass their reserve, the number of vendors opting to sell using this method increases. As reported by the REIV – by the end of June approximately 3,175 auctions will have been held. Only once in the past decade (2010) have there been more auctions in June, and in the inner and middle ring suburbs there is no perceptible sign of the market weakening, if anything the reverse is occurring.
It’s not quite the rampant atmosphere experienced in 2007 during which the ‘lending frenzy’ leading up to the GFC was pushing excessive amounts of easy credit into the market. Prices are still well below their peak and results patchy. Read more.