612 auctions delivered a 70% clearance rate with 575 properties selling privately last week. Another week of over 1000 reported sales to the REIV. Investors are still a strong influence on auction outcomes in the lower end of the market. Good investment properties between $400k and $600k still remain the strongest contests in the market due to their potential good value.
Everyone is comparing this year to last year and talking down the “spring” selling season. It hasn’t even started yet!! Has everyone forgotten the AFL final series? Traditionally the busiest weeks of spring are the third week of October, skipping Melbourne Cup weekend and then flowing through to about the second weekend in December.
This weeks 70% clearance rate compared to last year’s 83% is noteworthy for another reason. Total reported sales numbers were down 24% on this time last year, yet $turnover was down only 11%. We should see a relatively quiet 2 weeks whilst Collingwood makes its way to the AFL premiership, followed by a flurry of listings in the first two weeks of October. If stock levels don’t pick up then we must assume property prices will rise toward Christmas.
The Domain put out its “Property Review” over the weekend. And, as I have already had a number of enquiries about the worst performing apartments over the last five years, I have contacted The Age for a “please explain”. I do realise these figures are supplied by the REIV, but it would have been thoughtful to check at the very least the suburbs that you are going to use in your highlights page. I have not been through all the figures, but the summary on page 7 showing the least 5 year growth for apartments is totally inaccurate, if they are trying to show annualised growth.
For Toorak to have had an annualised growth over five years of -17.3% and to have a current value of $681,000, the median in 2005 must have been $1,760,433. Considering in 2004 it was $562,500, this would have represented a jump of 212.97%. I think somebody may have noticed this. Overall, all 10 of the suburbs listed with negative growth, have according to REIV published figures had a positive growth.
Statistics can be extremely useful and we use them all the time, but never take every published figure for granted. It could mean something completely different to what you thought. If you are interested in purchasing a property in Melbourne, please do not hesitate to give us a call for a chat.
Ian James