Throughout February, Melbourne’s real estate market exhibited outcomes that were favourable for both buyers and sellers alike.
Following a traditional February trajectory, our capital saw a lift in monthly auctions. It also witnessed a rise in annual auction numbers, which are up by 29.9%. This is good news for buyers as increased options reflect boosted seller confidence while decreasing competition for buyers.
Although increased listings can cause notable decreases in clearance rates, February did not reflect this. Demand remained robust, and despite recording a negligible clearance rate decline, Melbourne’s the only capital besides Sydney to record an annual increase.
Dwelling values also increased, monthly and annually. While gains experienced are slower than those seen in some capitals, Core Logic‘s Tim Lawless says the varied imbalance between supply and demand across Australia can explain this, with Melbourne buyers having greater choice compared to other markets since mid-winter.
Stabilised interest rates and forecasted cuts should contribute to further rises in housing prices. The CBA, Australia’s biggest lender, is forecasting 3 interest rate cuts in 2024 (75 basis points) and 3 in early 2025 (75 basis points) starting September 2024. This would see the cash rate drop to 3.6% in the second half of 2024 for the first time since May 2023.
According to domain.com.au, Melbourne’s rental market recorded a new record low in February, finishing with a vacancy rate of 0.8%. Rapid population growth due to overseas migration, a strained construction sector, and a continued rise of property prices remain as driving factors. A federal government migration strategy, which will see decreased numbers of international student visas granted, should assist in alleviating some pressure on this sector. Despite Melbourne’s available rental stock falling to record lows, views per listing have dropped monthly (-15.5%) and annually (-20.7%), suggesting demand is slowing, great news for prospective tenants.
If autumn sees you considering your next move, call your local Noel Jones office or contact us via noeljones.com.au and we will be happy to help you achieve your goals.
