The second super Saturday has achieved a 69% clearance rate according to the REIV. Although there were a lot more auctions with no result (71). This is well within the range that shows the Melbourne Property Market is humming along quite nicely. It was not a high 70’s that would have caused an instant run on the market and it wasn’t a rebounding 50% that would have shown last week’s 73% to be a fluke. It was a very nice mid-range result that will elevate Melbourne’s property market into action for the rest of this year.
I will take a punt that the Reserve Bank will not move interest rates tomorrow and that the status quo will remain for a little while. After all, the stock market is beginning its recovery, China and the USA are beginning to settle down to the current scheme of things and although the Catholic Church has some big decisions to make, I do not think this will strongly influence the rest of the world economies. I would say we are in for a very settled year where we will see good property offered to the market at fair and reasonable prices.
There will be the “huge” results now and then. There will be talk of the “top end” doing amazing things, both up and down depending on who you speak to. But it is the $400k – $750k segment that drives the overall market. This is where the vast majority of sales occur in Melbourne. This is where the vast majority of first home buyers and investors are sitting. It is nice to hear about multiple bidding on a $6M dollar home, but it really bears little on the average mum and dad home buyers or investors. After all, the top end of the market is so closely tied to the stock market that watching the all ordinaries index should give you a very good idea of the clearance rate each weekend for $2M+ properties.
2013 will be the year that sustained growth has come back to the Melbourne Property Market. I do believe we will see double digit growth. I think we will slowly move back to the long term 9% average growth for the better suburbs across Melbourne. I think the big movers this decade will be the Bayside suburbs south of Sandringham. More and more people will be housed south of Dandenong. If the Baillieu government gets its way, they will create huge employment opportunities for the Greater Dandenong region, and Eastlink and the now completed Peninsula Link were the major pieces of infrastructure needed to complete this expansion.
If this carries through, the more affluent people working in the Greater Dandenong area will be drawn towards the beach. Aspendale to Seaford will become the new Elwood to Sandringham.
The other big section of the market place to begin its upward movement will be the North East suburbs from North Melbourne to Essendon. This area is very well serviced with excellent transport, restaurants, easy access to the airport and good freeways and roads.
If you are considering purchasing a property in Melbourne, listen to what Enzo Raimondo, the CEO of the Real Estate Institute of Victoria, had to say in the Herald Sun on Saturday; “Buyers need agents too”
If you would like to speak with a buyers advocate, just to ask some questions, please feel free to contact us by phone, email, or leave a comment here.
Ian James
Director
JPP Buyer Advocates
