Moomba home auction buyers on the rise

The Moomba long weekend holiday proved no distraction for Melbourne’s hungry home buyers with the local auction market recording another strong result despite predictably lower listing numbers.

Melbourne recorded a clearance rate of 79.2 per cent on Saturday which was slightly lower than the 80.6 per cent recorded the previous weekend but well ahead of the 73.4 per cent recorded over the same holiday weekend last year.

Melbourne’s weekend clearance rate has averaged 79.7 percent since the season began in earnest in February which is the best start to the auction year since 2010. A season-opening record 4405 Saturday auctions however have been conducted over the past 6 weekends with the previous high of 4267 reported over the same period in 2014.

258 homes were listed for auction in Melbourne on Saturday which was lower than the 1182 auctioned the previous weekend and also lower than the 342 auctioned over the same holiday weekend last year. Auction numbers will be sharply higher next Saturday as the market moves back to normal mode with just under 1200 homes set to go under the hammer.

Melbourne’s booming north continues to record the highest regional clearances and was joined this holiday weekend by the inner east that also recorded a similar super-strong result.

The north reported a weekend clearance rate of 93.3 per cent with 14 sales out of 15 reported followed by the inner east 90.0 per cent, the inner south 84.6 per cent, the south east 80.0 per cent, the north east 77.8 percent, the west 7.8 per cent and the highest sales at 28, the outer east 74.1 per cent and the inner city with a clearance rate of 69.2 per cent

Notable sales reported at the weekend included a  4  bedroom home at 18 Carlyle  Street Hawthorn East sold by Kay and Burton for  $3,050,000, a  5  bedroom home at 13 Alister  Street Fitzroy North sold by Nelson Alexander for  $2,875,000, a  4  bedroom home at 967 Drummond  Street Carlton North sold for  $2,718,000 by Ray White, another  4  bedroom home at 88 Edgevale  Road Kew sold by Marshall White for  $2,315,000 and a  4  bedroom home at 73 Victoria  Street Williamstown sold for  $1,900,000 by Village RE.

The most expensive property reported sold at auction was at 7 Monomeath  Avenue Toorak, sold for  $3,850,000 by RT Edgar. The most affordable property reported sold at the weekend was a  1  bedroom unit at 7/9-13 Anthony  Street Melbourne sold for  $187,700 by Purplebricks VIC.

For a list of Melbourne auction results click here Melbourne auction results Saturday March 11

Melbourne recorded a median auction price of $755,000 on Saturday which was lower than the $843,750 reported the previous weekend but 7.9 per cent higher than the $699,500 recorded over the same weekend last year. A total of $87.4m was reported sold at auction in Melbourne at the weekend.

Low interest rates remain a significant driver for the recent strong performance by the Melbourne housing market. Reflecting a positive result for national economic growth over the December quarter announced by the ABS, the Reserve Bank predictably decided to leave official interest rates on hold over March. Although underlying economic activity remains underwhelming, the likelihood is that rates will remain on hold at least until mid-year.

Mortgage rates however will likely continue to rise with surging investor lending again a key target for financial regulators. Higher rates for investors however have the risk again of market disruption with lending volumes heavily skewed towards NSW and the Sydney and Melbourne rental markets still tightening with a shortage of accommodation and rising rents.

Andrew Wilson is Domain Group Chief Economist Twitter@DocAndrewWilson join on LinkedIn and Facebook at MyHousingMarket