Melbourne auctions resume as prices and rents rise

Melbourne’s weekend home auction market returns for 2017 this Saturday although numbers will be typically small as the city slowly shakes off the summer holiday vibe.

Just 45 auctions are listed to go under the hammer which will be well below the 97 recorded over the same weekend last year.

Melbourne’s north will host the highest number of auctions this weekend with 14 followed by the west 11, the outer east 6, the inner east 5, the south east 4, the inner city 3 and the north east and the inner south with just 1 auction scheduled on Saturday.

Craigieburn is clearly the most popular suburb for auctions this weekend with 11 followed by Surrey Hills 3 and a number of suburbs with 2 auctions including St Albans, Melbourne, Point Cook and Kings Park.

With small numbers being offered, clearance rates this weekend will not be a reliable guide to underlying market conditions. The following weekend however nearly 200 homes will be auctioned in Melbourne with results likely to more indicative of the strength of the market for sellers.

Melbourne recorded a robust and consistent spring selling season through 2016 with weekend clearance rates averaging just under 80 per cent.  Regional results were also consistent with the inner south recording the highest clearance rate over the December quarter at 80.1 per cent followed by the north east 79.3 per cent, the outer east 78.1 per cent, the north 77.2 per cent, the west 74.0 per cent, the inner east 73.0 per cent, the inner city 70.9 per cent and the south east 70.2 per cent.

Strong auction market conditions have predictably translated into strong prices growth in Melbourne with the median house price rising by 3.6 per cent over the December quarter to a record $795,447 – an increase of 10.3 percent over 2016. Unit prices also increased over the quarter – up by 2.4 per cent to a median $459,181 and an annual increase of 2.8 per cent.

Melbourne rents are also rising with median asking house rents up by 2.5 per cent over 2016 to $410 and unit rents up similarly by 2.7 per cent over the year to $380 per week.

Dr Andrew Wilson is Domain Group Chief Economist Twitter@DocAndrewWilson join on LinkedIn