With an REIV 62% clearance rate, up from 54% on this time last year, we can see the market is changing. It is waking from an eighteen month slumber. The market will not revitalise itself overnight, but over the next six months I think we will see solid growth in the suburbs of Melbourne with good amenity.
The Valuer general put the Melbourne median movement in 2011 at approximately 1% down. In 2010, the median for the whole of Melbourne moved upward a whopping 17%, even though the downturn began near the end of April. This year’s results from the Valuer General will not be available until about June next year, but anecdotally, I believe the overall market will have been very stable and close to no movement. Some of the better suburbs will have moved a little forward and many of the new estate suburbs will have contracted in value.
Whilst we see many companies talking about monthly median movements, the small samples of sales these companies are basing these results on make the results nearly useless. Considering the different data analysts all have different methods of collecting, collating and then analysis, and they all have different results, it is pretty easy to get confused with where the market is going.
With owner occupiers making up a large percentage of the market during the current season, and if we get another interest rate cut on Cup Day, I think we will see turnover dramatically increase in the autumn season next year. With increased turnover and good amounts of owner occupiers, I think the market is poised to return to positive growth over the next few years.
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JPP Buyer Advocates