It’s a record year of Victorian real estate records
FOLLOWING a record breaking year in 2015, the state’s property market was closely watched by all in 2016.
While the residential property sector slowed in most states in 2016, Victoria’s market defied the trend and remained solid, gaining strength throughout the year.
Though transaction volumes have been below 2015 levels, the median house price has continued to increase this year with clearance rates at their highest since 2009.
Echuca proved a regional trend setter, all but halving the number of days properties are on the market before selling to just 47.5.
Local agents have reported demand is fast outstripping supply and their biggest challenge is finding listings, not buyers.
As the year draws to a close, it is timely to review the market in 2016 and the outlook for Victoria in 2017.
Transactions and Auction Volumes
Transaction volumes in Victoria have been lower than last year with an estimated 121,600 sales in the year to November 30.
In the year to November 30, around 35,000 auctions have been held with over 26,000 homes selling under the hammer.
About 32,700 of those auctions were held in Melbourne, compared to 2400 in regional Victoria where private sales are more popular.
This year has been characterised by lower transaction volumes, higher median prices and higher clearance rates making it an ideal sellers market.
The year is set to end strongly for auctions with December shaping up to challenge the all-time record number of auctions for the month and, given the recent clearance rate, is certainly likely to exceed the auction sales record set last year (2459 auction sales).
Median price Growth
Significant house price growth has been recorded in metropolitan Melbourne throughout 2016 with the median reaching the $740,000 mark for the first time ever in the September quarter.
House prices have also increased in regional Victoria over the year, although at a more moderate pace, with the median house price hitting $348,500 in the three months to September 30.
This was up from $347,500 in the first quarter of 2016.
Growth has been widespread across the city, with price increases recorded in all three regions — inner, middle and outer.
The September quarter saw the city’s median house price rise 3.2 per cent to a record high $740,000.
Melbourne’s inner and middle suburbs were the main growth drivers in the September quarter with house prices in these regions up 4.2 and 3.5 per cent respectively.
Million dollar suburbs
Buyer demand in traditional million dollar suburbs has pushed up the median house price in neighbouring areas.
As a result of the ripple effect, more of these suburbs have joined the million-dollar club this year.
There were 77 suburbs valued at $1 million or more in the March quarter, and this has since increased to 104 in the September quarter.
There are in fact now 13 suburbs with a median price of $2 million of more, with Toorak remaining Melbourne’s most expensive suburb with a median house price of $4 million.
This is followed by Malvern and Canterbury with median house prices of $2,961,000 and $2,388,000 respectively.
Toorak also led the list of top end sales this year, with 43 homes selling at or above $5 million, well ahead of Brighton, Kew and South Yarra.
While listings remain low and clearance rates high, the REIV expects median house prices to increase once again in the December quarter followed by the traditional slowing in January before picking up again by March.