Weekly Market Update - May 29, 2019
By | 28th May 19

Market predictions for the rest of the year

Melbourne’s property market could have now come out of the bottom of the market with improved buyer confidence and enquiry being felt across many Melbourne suburbs. Many agents and our company have seen a huge spike in enquiry since the election. The Melbourne clearance rate was at a six month high of 64% from a larger volume of over 700 auctions passing the first Super Saturday test after the election.

 

This is the highest clearance rate Melbourne has seen since Spring last year and there were some solid results including more big results in Fitzroy where a house in King William Street sold for $2,200,000, $300,000 over reserve with 2 bidders fighting it out for a house on 176m² of land. Another solid result was a 2 bedroom townhouse in Rushall Crescent sold $153,000 over reserve with 3 bidders pushing it to $1,530,000. We also missed out on a house in Danks Street, Albert Park for a young family which sold for $1,700,000 which went well above our client’s budget with 6 bidders contesting.

 

There have been many positive developments in the last couple of weeks that should impact the property market positively, these include APRA’s change to caps and the RBA’s governor saying that it is likely they will be reducing interest rates and other positive features and factors which should be positive for our property market.

 

Good news for buyers and investors as it looks like APRA will lift its 7% lending cap rates imposed on the banks. They will now allow the banks to use their own caps which hopefully will free up some more credit for buyers to be able to buy more property. Many of our investor clients have been struggling to get loans and finance with this 7% cap.

 

Australia is no longer the top choice for Chinese investors as it is now second behind America as the most popular spot. Loan availability is the biggest issue and has had a significant effect on the Australian property market as well as increased taxes and banking restrictions that are making loans more difficult to obtain.