6th June 2023 / Jeremy Desmier: Market Update | 3 & 4 June 2023

The start of the winter selling season saw 1,832 properties auctioned over the weekend across the combined capitals, with a state-wide clearance rate of 75.8% recorded in Victoria. The Fletchers Group was thrilled to achieve an 82% success rate for our clients.

The REA Group reports that home prices across the country have risen again for the fifth consecutive month, despite the Reserve Bank's decision to lift the cash rate in May. As we await the June decision, we have seen that tight supply has continued to keep a floor under house prices.

"Home prices in the combined capital cities have risen 1.34% in the past three months, the strongest quarterly growth since the December quarter of 2021," PropTrack senior economist, Eleanor Creagh said. She went on to add that, "auction activity has improved, and clearance rates remain firm after rising above levels seen in the second half of 2022."

There were a number of fantastic results achieved over the weekend. In Nunawading, an incredible seven bidders competed to secure the four-bedroom home at 6 Evandale Avenue, which had been lovingly maintained by the same family for over 70 years. On Saturday it was time for a new family to make it their own, with the home selling under the hammer for $1,251,000.

The lovely Spanish Mission residence at 17 Karma Avenue in Malvern East saw three bidders in competition before it sold under the hammer. On a generous corner allotment, the property boasted exquisite period detail and an excellent location close to schools, transport, and cafes.

Held indoors due to the rain, the auction of the Art Deco home at 882 Riversdale Road in Camberwell attracted three bidders. Undeterred by the inclement weather, the successful purchasers were thrilled to secure the gorgeous three-bedroom home zoned for Canterbury Primary and Camberwell High School.

With fewer homes hitting the market compared to the same time last year, we are seeing a more competitive buying environment and buoyed home values as there remains an excess of buyer demand. Prices are keeping resilient to the falls the calculated shift in borrowing capacities would imply.

Although interest rates are likely or at close to peak levels they may still rise further, and the economy is expected to slow. These factors may weigh on home prices in the month ahead and the pace of price rises may slow if we see an increase in stock on the market, but the REA Group reports that with the recovery in home prices becoming entrenched and the fundamentals of housing demand remaining strong, there is little to suggest that prices will fall in the months ahead.

Auction activity is expected to be quieter next weekend, due to the King's Birthday long weekend, however numbers are due to rebound the following week.