Auctions driven by east as more records to be broken

Last weekend saw the most auctions on a Saturday in September ever, with 1036 homes up for sale. This weekend, 969 homes are scheduled to go under the hammer but we might not be far off breaking yet another record.

Supply is moving closer to demand, but local conditions still generally reflect a typically healthy spring market for sellers.

With this in mind, all eyes will be on September 26, the pre-Grand Final Super Saturday. Sellers typically flood the market to avoid the distractions of the big game, and an all-time September high may yet again be established.

For this weekend, it’s the east that’s expected to be a standout.

Unprecedented numbers of auctions are expected to continue with the inner-east region leading the pack with 150 listings, closely followed by the outer east with 143.

The west will have 139 auctions, followed by the inner south and inner city, each with 133 auctions, the north east 121, the north 84 and the south east with 65.

The most popular suburb for auctions this Saturday is again Reservoir with 18, followed by Mount Waverley 17, Richmond 16, North Balwyn and Brunswick each with 15, Kew and Hawthorn each with 14 and Glen Iris with 13 auctions scheduled.

Melbourne’s clearance rate fell again last weekend as record numbers of early spring auctions continue to flood the local market.

Saturday’s clearance rate of 75.7 per cent was just below the previous weekend’s 76.3 per cent result and the lowest reported since Valentine’s Day.

Melbourne has now reported consecutive weekend clearance rates below those recorded at the same time last year.

Although the clearance rate was down last weekend, Melbourne’s trend auction price increased marginally from the previous weekends $797,250 to $798,972 and remained 8 per cent above the $739,750 recorded over the same weekend last year.

Lower clearances rates in Melbourne may reflect the recent action by banks at the direction of financial regulators to tighten lending conditions for local investors.

Latest ABS data reported Victorian residential investment finance was down by 4.4 per cent over the month but remains 26.9 per cent higher over the first seven months of this year compared to the same period last year.

Less local competition for new residential investment properties may however be particularly welcomed by rising numbers of foreign investors who continue to be attracted to Melbourne property.

Any reduced activity from investors will not be welcomed by tenants.

There is strong competition for available rental properties, as reflected by Domain Group house vacancy rates for August tightening to a low 1.7 per cent.

Dr Andrew Wilson is Domain Group Senior Economist Twitter @DocAndrewWilson