Market nearing peak
MELBOURNE’S property clock could be approaching five minutes to midnight as researchers suggest the city’s real estate market is nearing the top of its growth phase.
According to PRD Nationwide’s Australia Economic and Property Report for the second half of 2015, Melbourne’s property market has grown 10.6 per cent year on year to September 1, and the median house price is $726,000.
CoreLogic RP Data’s latest Home Value Index, released earlier this week, supports the view that the rate of capital growth is slowing, despite naming Melbourne as the bestperforming capital city over the past three months.
The CoreLogic index showed 3.1 per cent value growth for Melbourne in the past quarter, with a more conservative median house price of $675,000.
The median price is up 12.8 per cent year on year.
It’s the second month that Melbourne has had the strongest capital city quarterly growth.
However, the pace has slowed since September, a sign that conditions for housing growth are cooling, CoreLogic RP Data head of research Tim Lawless said.
“It’s not just the fact that mortgage rates have been recently raised outside any lift in the cash rate,” Mr Lawless said.
“We’re also seeing about a 30 per cent premium on investment-related mortgage rates, tighter lending standards and borrowers generally requiring a larger deposit.”
Mr Lawless said auction clearance rates had been trending lower since April.
Melbourne recorded its second sub-70 per cent clearance in as many weeks last weekend, when CoreLogic reported a preliminary 69.5 per cent of reported auctions were knocked down, although from a low volume. Sellers at Glen Waverley accepted a $2.6 million offer ahead of an auction last weekend for a redevelopment or renovation opportunity.
The home at 11 Charlotte St was the most expensive auction result from last weekend.
Barry Plant Monash agent Tony Ievoli negotiated the sale of the 730sq m property.
The volume of auctions almost doubles this weekend, with almost 1100 scheduled.
Buyers paid $2.6 million to secure this Glen Waverley development opportunity prior to auction last weekend.