Market fall slows but not over yet
Geelong prices dropping fastest in regional Vic
THE decline in Geelong’s house prices since the peak of the market last summer reached almost 5 per cent in November.
But the momentum in the fall in prices continued to slow, with $3000 shaved off the median home value last month, the latest monthly PropTrack Home Price Index showed.
Despite the slowing trend, PropTrack senior economist Eleanor Creagh said it was too early to say the city had reached the bottom of market.
Since prices peaked in February, Geelong’s median home value had dropped 4.91 per cent, and fell 0.1 per cent in November to $775,000.
Over three months, the price fell .56 per cent and for the second month is lower than the same time last year, this time by 1.84 per cent.
“It’s probably too early to say we’ve seen the market has
bottomed,” Ms Creagh said.
“We’ve got additional rate rises on the horizon, borrowing costs are going to increase and borrowing capacities are going to further reduce.”
Ms Creagh said Geelong prices were falling the fastest in regional Victoria, in line with a national trend where the most expensive regions had the hardest falls.
The impact of rising interest rates continues to loom over homebuyers across the nation. The Reserve Bank board meets next Tuesday
when it’s expected to increase the cash rate another .25 percentage points.
Ms Creagh said a further rise was expected in early 2023 before the central bank would reassess the state of the economy.
Geelong real estate agents have described the changing conditions as a city returning to a normal market. There are less auctions, more properties being passed in at auctions and more vendors are choosing to take offers prior to auction.
The region’s clearance rate hovered just above 50 per cent through November.
Agents had to work harder and longer to find buyers, especially for homes selling by private treaty, with the average campaign now at 4½ weeks.
But buyers from outside the region, particularly from Melbourne, continue to boost demand for properties.
Ms Creagh said search and demand figures on the realestate.com.au platform showed some people continued to look to relocate to the regions.
“We believe that people are still shifting towards the regions, it’s just the pace that they are doing so has eased,” she said.
“That’s because people are still looking for larger homes and that relative affordability advantage that many regional areas have to offer, particularly with interest rates have risen substantially this year.”
Whitford, Newtown director John Moran said there had been a recent increase in interest from Melbourne buyers.
“There’s been a little bit more in the past three to four weeks from buyers down from Melbourne,” Mr Moran said
“I don’t know whether it’s picked up a little bit, but there has been an influx in the last three to four weeks.”
The Commonwealth Bank
Regional Movers Index showed a 6 per cent up-tick in people moving from capital cities to Geelong in the three months to September, although the total was about 18 per cent lower than at the height of the pandemic in 2021.
Nationally, capital city to regional migration remains above pre-Covid levels.