Steady end to robust Melbourne summer market points to solid autumn



The robust Melbourne home auction market ended summer with a steady result last Saturday despite a surge in listings – particularly in the inner suburbs 

Melbourne will begin the autumn selling season this weekend with healthy auction numbers continuing to test the resilient local market.

Well over 1100 homes are set to go under the hammer on Saturday, which although below last Saturday’s 1212 offering will nonetheless offer buyers another wide choice of property to consider – and another solid test for the market.

Although this weekend’s auction numbers are well ahead of the 284 conducted over the same weekend last year this reflects the impact of the quieter Labour Day holiday of last year which this year is scheduled a week later next weekend. 

Melbourne reported a clearance rate of 75.3 per cent last Saturday which was lower than 77.9 per cent recorded the previous weekend and also below the 80.1 per cent recorded over the same weekend last year.

Although the market tracked backwards last weekend local conditions remain clearly favourable for sellers. Melbourne clearance rates this year so far are highest recorded since last winter and confirm the underlying quiet and resilient confidence of the local market.

Melbourne’s inner city suburban region will host the most number of auctions this Saturday with 178 closely followed by the west and the inner east each with 162, the north-east 160, the inner south 154, the outer east 136, the north 97 and the south-east 60.

St Kilda will host the most number of auctions of any of Melbourne’s suburbs this weekend with 24.  Next highest is Reservoir with 20 followed by Glen Iris with 18, Kew and Mount Waverley each with 17 and Glen Waverley, Elwood and South Yarra each with 15 auctions listed on Saturday.

Low interest rates are a key catalyst of continuing solid housing market activity in Melbourne with the Reserve Bank having decided this week to again leave rates on hold over March. Rates have now been steady at the record low 2 per cent for 10 consecutive months although the prospect remains for a near-term cut. 

Recent economic data has been disappointing with the ABS national unemployment rate back up to 6 per cent, wages growth the lowest on record and the confirmation that the peak of the home-building boom has clearly passed.

A sustained period of unemployment above 6 per cent would probably motivate the bank to cut rates in an attempt to stimulate an increasingly lifeless economy.  

Dr Andrew Wilson is Domain Group’s chief economist

Twitter @DocAndrewWilson