The first two weekends of February saw the property market spring back to action after the typical summer lull, and it would appear that the residential auction market has picked up where it left off last year.

2007 was characterised by substantially higher demand than previous years, as well as an increase in the amount of property on offer. Melbourne saw around 30,000 auctions held including four Saturdays with more than 1,000 auctions. Last year the market ended with a clearance rate of 82 per cent, which was a historically high level.

The first significant auction weekends for 2008 saw a total of 390 auctions held and a clearance rate of 78 per cent.

Today there are around 650 auctions scheduled, and there are over 1,000 auctions scheduled to be held next weekend.

In total we expect to see just over 2,100 auctions held in the month of February.

This is a remarkable increase in the number of properties that are going to auction. The month of February in 2007 saw 1,728 auctions, in 2006 there were 1,679 and in 2005 there were 1,542 auctions held.

It is too early to see any impact from recent interest rate increases, as many of February’s sales will have been scheduled last year or early this year, and many prospective purchasers committed to the need to buy.

It is our experience that the market often takes six to eight to weeks to show an impact from interest rate increases. It must also be remembered that the auction market is not representative of the entire property market in Melbourne, as around 70 per cent of all properties are sold by private treaty.

The REIV’s March quarter median prices, which are scheduled for release in late April, will be one of the first indicators of the effect, if any, of the latest interest rate rise.

Article provided by The Real Estate Institute of Victoria REIV

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This entry was posted on Wednesday, February 20th, 2008 at 6:11 am and is filed under Buying Property, Selling Property. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.