30th July 2024 / Jeremy Desmier: Market Update | 27 & 28 July 2024

Over the weekend, Melbourne recorded the highest number of auctions across the country, with 840 homes taken to market. The preliminary clearance rate held just below the 70% mark, recorded by CoreLogic. The Fletchers Group was thrilled to achieve a success rate of 83%.

In Vermont, four bidders competed to secure the vibrant, single-level unit at 2/38-40 Mcclares Road. In a convenient location, the property is within walking distance of shops, cafes and bus services. Auctioneer Ben Williams sold the property under the hammer for $939,000.

The well-maintained, three-bedroom home at 13 Maguire Street in Lalor offered the perfect opportunity for savvy investors, first-time buyers and downsizers. In a tranquil neighbourhood close to local amenities, the property was sold for $790,000 by the Fletchers Bundoora team.

PropTrack is revising their forecasts for price growth for the remainder of 2024. The group now expects that prices will increase by between 2% and 5% in the current calendar year. Whilst there are revised forecast changes for a number of capital cities, price growth expectations remain largely unchanged in Melbourne and Sydney, but it is believed they are more likely to be on the higher-side of forecasts.

Prices are currently rising at a faster pace than anticipated despite interest rates sitting at a 12-year high, substantial falls in borrowing capacity and the volume of stock has increased significantly. The PropTrack group reports that over the past few months, the rate of home price growth has started to slow, and we have seen stronger than anticipated inflation. As a result, expectations of interest rate cuts have been pushed back from September this year to middle to late 2025.

Rate cut expectations are likely to have played into purchaser confidence and impacted recent price growth. Given this, rate cut expectations being pushed back may dampen buyer activity. However, this will be tempered by the Stage 3 tax cuts recently introduced, which have increased the disposable income for most households, therefore increasing borrowing capacity.

As we move into early 2025., interest rate cuts are likely to be getting loser, which may entice more buyer demand and contribute to further price increases. The CoreLogic group expects that price growth by the end of the 2024-25 financial year will be slightly stronger than what is expected for the end of the current calendar year, with he profile of growth shifting (with an uptick in price growth in the larger markets of Melbourne and Sydney).

This weekend, we'll begin auctions for the final month of winter, before what is shaping up to be a busy Spring selling season. If you need any property advice, please give us a call.