Melbourne purchasers beware!

1180 auctions are going up for auction today, the most in 2 years.

If the gloom of Melbournes property market is as what some people state, then given the context of poor confidence in the market, the argument of over priced homes, would predict a material fall in the clearance rate, which has hung around approx 60-66% for the past 2 months.
 
buzzlightyear said:
1180 auctions are going up for auction today, the most in 2 years.

If the gloom of Melbournes property market is as what some people state, then given the context of poor confidence in the market, the argument of over priced homes, would predict a material fall in the clearance rate, which has hung around approx 60-66% for the past 2 months.
Click to expand...

It will be interesting to see how they go.
 
Aaron_C said:
Hardly. See: http://www.realestate.com.au/property-house-vic-hawthorn-111761939

300 sqm land, sold for $1.661m. House is decent but it's a narrow block.

#2: http://www.domain.com.au/Property/For-Sale/House/VIC/Hawthorn-East/?adid=2010036728

Sold for $1.3m with a crap house on 550 sqm of land on a busy road.

These are just some anecdotal evidence of a good market. Not falling as many people predict.
Click to expand...

Why is it that permabulls cry 'markets within markets' but are the first to use a handful of examples and 'anecdotal evidence' to make sweeping generalisations about a city of 4+ million people?

Some suburbs in Melbourne are falling. Some are rising. Some are in between. The best you could say about the overall Melbourne market right now is that it is stabilising and showing signs of improvement. What you actually said is 'the Melbourne market is still extremely strong' which is an utter lie.

If it were still extremely strong, we wouldn't be impressed by a measly 66% clearance rate (the actual clearance rate would be lower, but that's always the case) during a time of historically low interest rates.

If it were still extremely strong, we wouldn't think anything of a 80% clearance rate and properties doubling in value within 12 months. Obviously, that isn't happening right now because, golly gosh, the Melbourne market is not still extremely strong.
 
Last edited:
Fifth said:
If it were still extremely strong, we wouldn't be impressed by a measly 66% clearance rate (the actual clearance rate would be lower, but that's always the case) during a time of historically low interest rates.
Click to expand...
Where the auction clearance rates are a mislead designed by the R/E industry is that;

*not all the figures are reported, and
*they include failed auctions that are sold afterwards as an auction success, and
*they pretty much always do well with auctions in the "leafy suburbs" where it is nothing but auction sales, whilst
*every where else you can't get an opening bid other than from the Vendor.
 
BayView said:
Where the auction clearance rates are a mislead designed by the R/E industry is that;

*not all the figures are reported, and
*they include failed auctions that are sold afterwards as an auction success, and
*they pretty much always do well with auctions in the "leafy suburbs" where it is nothing but auction sales, whilst
*every where else you can't get an opening bid other than from the Vendor.
Click to expand...

Correct, auction reporting figures are unregulated and as such an unreliable method of deeming market conditions. :)
 
Two sides of the same coin.....

It amuses me on reflection, that the same accusation of those so-called 'perma bulls' is that they negate, devalue data or evidence to suggest the flat or falling markets. The same applies to the 'perma-bears', if I can use the clumsy non-descript collective noun.

The reality is Melbourne market is still fragile, and from mid 2010 to mid this year was heading south. However, what is also clear is there here has been a definite change in the numbers on the ground for the past 2-3 months. That does not imply a booming market, but it does provide a clear point of difference in the overarching doom mood/status that has been attributable to property in the mainstream media for the past 2 years.

Auction clearance rates to me measure the pulse/mood of the market, it does not necessarily have direct causal relationship to prices. And yes, the measure in itself is not perfect, but the trend is, which is clearly above last years rates and maintaining. In all likelihood, the clearance rate will be adjusted downwards as all results are submitted, as has been the reality for the past few months, but maybe a couple of % points.

I will listen to the evidence provided by all parties, irrespective of their bias. But will dismiss emotionally charged advice from technocrats, self-appointed experts and those who generally repeat a paragraph or smart sentence they picked up from some blog, internet article that sounded 'right' to them.

So in response to Melbourne purchasers beware, I would counter, Melbourne purchasers & sellers, be alert not alarmed.......
 
My part of the woods yesterday (inner north-east Melb, $1M+ houses).

Attended 6 auctions on what was dubbed 'Super Saturday':

- All 6 passed in
- 4 to vendor bids, 1 to a very forced bidder (it was awkward to watch)
- 1 passed in to a bidder who bought after auction (not sure of what price)

So... people are still reluctant to buy at auctions. This market I'm looking at has not moved since 2010. Yes, these houses are not targeted at investors, we are looking for PPOR.

These houses will all sell this week or within a few weeks maximum. But definitely no frenzied buying that we used to see. Buyers are still very cautious and sellers need to meet the market.

It was a bit all too deja-vu for me yesterday!

http://www.realestate.com.au/property-house-vic-alphington-111761303
PI VB $1.1M

http://www.realestate.com.au/property-house-vic-fairfield-111770051
PI VB $1.1M

http://www.realestate.com.au/property-house-vic-fairfield-111775063
PI

http://www.realestate.com.au/property-house-vic-alphington-111710367
PI one forced bid $1.1M

http://www.realestate.com.au/property-house-vic-alphington-111705939
PI VB $1.15M

http://www.realestate.com.au/property-house-vic-alphington-111754827
PI one bidder $960K. Sold after negotiations.
 
i followed a mate around yesterday in bayside.

he auctioned 9 and 8 sold , all above reserve, the 9th went above the reserve vendor set fri nite, but they got greedy and changed mind sat morning. he made $120k for his agency, not a bad day

the market is strongest since early 2010 and i am for the first time since since early 2009 telling people not to wait any longer.

inner city apartments and new housing estates however likley to drop more, wouldn't go near those
 
i went to the block challenge house auction and there were many people there. people in ferraris and porsches all parked out front. there were bids to 1 million but then it got passed in at vendor bid of 1.05 million. personally they vendor should have taken it as it was a single storey house and that similar sizes which weren't that new sold around 800-900K.

http://www.realestate.com.au/property-house-vic-south+melbourne-111714907

went to another art deco 1 bedder which had no one turned out on st kilda rd.

then went to brighton to see a place being taken up by some chinese dude for 1.2 milion plus.
 
Very little chance of "picking the bottom". Property is such a long game - 10% either side of the bottom and you are doing well.
 
buzzlightyear said:
Auction clearance rates to me measure the pulse/mood of the market, it does not necessarily have direct causal relationship to prices.
Click to expand...

Rather than "health", could auction clearing rates also reflect the level of alignment between vendor expectations and what the market is prepared to pay?
 
vaughan said:
Rather than "health", could auction clearing rates also reflect the level of alignment between vendor expectations and what the market is prepared to pay?
Click to expand...

Yes, but it would be very generalized view, wouldn't you agree?

"onthehouse.com.au" I had noticed one interesting deal, as I remember bidding and backing out of this property, yet a school mum bought it and sold it 10 months later. Details are:
52 Sunnyside Crescent, Castlecrag NSW 2068, bought
Sold: $1,180,000
on 22/09/2011

then 10 months later:

Sold: $1,360,000
on 20/07/2012

Nothing was done to the house as I drive past it quite often.....
When I asked the mum why she sold she said they got a good price for it, so I suppose in even hard or negative times some positive deals are made...:)
 
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