Weekly Market Update - 18 June, 2019
By | 18th Jun 19

What to expect from the property market this week.

Melbourne’s property market continues it recovery with improving clearance rates being seen this year. This weekend’s clearance rate of 69% was from a volume of 521 auctions and it was the highest clearance rate I can remember for the last 6 months. There’s definitely more buyer demand and consumer sentiment has improved and the number of bidders has increased at auctions compared to last year. Many auctions have three to four bidders as we saw for a house in Stephen Street Yarraville where 4 bidders fought it out and the modern home sold for $1,340,000. There were also 4 bidders Ormond Street, Brunswick where a double fronted house sold for $972,500, with four bidders pushing it past the $920,000 reserve.

 

There continues to be pressure on the RBA to cut rates again with job figures pointing to another rate cut. Australia’s jobless rate has clocked in above 5% for another consecutive month and there is now pressure on the Reserve Bank to cut rates potentially in July or August again. This always tends to lead to increased demand from buyers and in particular, investors.

 

The rental market is getting stronger as there are less properties on the market as less investors are buying entry level apartments and units. Rental properties near bayside are taking only 19 days to find a tenant, followed by Northern suburbs such as Collingwood and Preston. As more properties continue to be sold to owner occupiers, the rental market will continue to feel more pressure to provide rental accommodation for tenants.

 

The building slowdown has definitely deepened as numbers are now at a 6 year low for the construction sector. Australia’s construction sector is facing its sharpest decline in over 6 years. In the apartment building sector, market activity has been contracting for 14 months.