Outer Melbourne still recording solid clearance rates, though buyer demand softening city wide

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Dec 11, 2017

Outer Melbourne still recording solid clearance rates, though buyer demand softening city wide

Sydney and Melbourne auction clearance rates are languishing as buyer demand softens.

Image: JellisCraig Armadale.

This five-bedroom home at 6 Moorakyne Avenue, Malvern, sold for $6.6 million last week, making it one of Melbourne's top sales, according to CoreLogic.
Image: hockingstuart Point Cook.

This four bedroom home at 4 Teeside Court, Point Cook, recently sold for just over $1 million.

Gil King, CEO of the REIV, told SCHWARTZWILLIAMS, there were 1,366 auctions held last week in Melbourne, and a preliminary clearance rate of 68 per cent was recorded.

Both figures were below the results for the same period last year, said King, when 1,470 homes were auctioned with 79 per cent selling under the hammer.

Despite the statewide clearance rate dropping below 70 per cent, King said the outer suburbs are still performing strongly.

Point Cook, which is 25 kilometres south west of the Melbourne CBD, saw 14 properties sell under the hammer last week, making a clearance rate of 93 per cent, according to REIV data.

Alexander Hua of hockingstuart Point Cook told SCHWARTZWILLIAMS there is still a lot of interest in the area, and auction clearance rates are definitely above the state average.

Hua said Point Cook is still appealing to buyers, and is particularly popular with the Asian and Indian market. He said the area still boasts large blocks, and has a modern town centre with a large range of retail outlets, and is known for good schools. He said Point Cook is popular with both first and second-home buyers.

"The market is definitely strong" in Point Cook, he said.

Balwyn North had a record-breaking week

Balwyn North set a new suburb record for unit/apartment sales as 1/41 Corhampton Rd sold at auction for $1,910,000, according to the REIV. The previous record was set two years ago.

“Despite the clearance rate remaining below 70 per cent for the third consecutive week, vendors still experienced solid results under the hammer with Balwyn North achieving a new apartment/unit record," said King.

Buyer demand is weakening in Sydney: Leanne Pilkington, REINSW

Leanne Pilkington, president of the REINSW, told SCHWARTZWILLIAMS that Sydney's preliminary clearance rate was 58.7 per cent, across 990 auctions. The result was a slight increase on last week’s final clearance rate of 56.2 per cent, when 1,143 auctions were held.

Last week was the seventh consecutive week the Sydney market recorded a clearance rate in the mid to high 50s.

At the time last year, more auctions were held in Sydney - 1,163 - and a higher clearance rate was achieved - 73.7.

"The significant difference between last year and this year is a clear sign of the cooling market," said Pilkington.

"Although agents are still reporting that some well priced properties are still selling well, the reality is that buyer demand is much softer now than it was earlier this year."

"Agents are now listing for the new year, and, in welcome news for buyers, are reporting some great properties due to hit the market in February," she said.

Capital city auction statistics (preliminary)