3rd October 2022 / Jeremy Desmier: Market Update | 1 & 2 October 2022

On what was a beautiful Spring weekend, auction volumes across the combined capital cities increased by 18.2% to 1,167 properties scheduled to go under the hammer. The combined capitals clearance rate was 60.2%, the highest clearance rate since April, highlighting how seller and buyer price expectations are beginning to align.

In Burwood on Saturday, the newly renovated single-level home at 7/25 Roslyn Street attracted two bidders but was passed in to the highest bidder. Offering open living, gourmet kitchen, and north-facing courtyard, the home was quickly sold post-auction for $725,000.

The attractive three-bedroom home at 26 Vernal Avenue in Mitcham attracted four bidders. Offering two inviting living areas, an alfresco deck and lots of future potential, the property is well located within the prized Vermont Secondary College zone. Auctioneer Michael Richardson knocked the property down to the highest bidder at $1,143,000.

A number of properties also sold prior to auction, including the stunning, contemporary home at 83 Albion Road in Ashburton. Boasting three living zones and a resort-inspired alfresco area, the successful purchasers were thrilled to secure the first-class family home.

Despite media speculation of significant declines in house prices, the PropTrack Home Price Index for September 2022 shows that Australian home prices in the first month of Spring fell just 0.19%. The pace of price falls moderated significantly, and prices ae still significantly above their pre-pandemic levels. Regional areas remain up almost 50% since March 2020 and capital city prices are up 25% over the same time period.

Of course, buyers and sellers will continue to monitor the Reserve Bank's decisions on interest rates, as they are expected to continue increase in the effort to combat the inflation rate. Whilst the increases aren't unexpected, it will be the pace at which the RBA proceeds that will have the most significant impact on house prices.

Whilst borrowing capacity is constrained and borrowing costs have increased, the fundamentals of the property market remain sound. The Australian economy continues to perform well, with unemployment at close to a 50 year low. This will drive stronger wages growth which will, in-turn, rebuild borrowing capacities somewhat. Increased investor activity, as well as immigration, is also likely to boost markets in the larger cities.

We look forward to a busy weekend coming up – hopefully with a repeat of the stunning weather!

Results. It's a Fletchers thing.