Market Overview
According to the REIV overview of 2015 published earlier this week, the general consensus of the last calendar year can be summed up in one word: big.
2015 will go down in the record books as a year in which records were consistently broken.
The biggest news was the rise in median house prices. The Melbourne metropolitan area punched through the $700,000 mark, capping off growth across the inner, middle, and outer markets.
As demand for traditionally premium suburbs increased, buyers looked to surrounding areas. The result of this ripple effect saw suburbs across the east, south east, and north east record the largest increases in median price value. As the median price reached the record high of $729,500 in the third quarter, bayside suburb Brighton and surrounding including Dromana and Seaford pushed up by 17%. Glen Waverly, Templestowe, and Balwyn North also raised 17%, while Mount Waverley, Beaumaris, and Bentleigh increased 16%.
With buyer interest extending to surrounding suburbs of the in demand areas, more suburbs have joined the $1million club. 87 suburbs in the Melbourne area now have a median price of the magic million mark or higher.
Transaction volumes have also reached levels not seen in half a decade according to the REIV.
116,000 sales have been recorded up to the end of November, compared with 110,400 sales up to the same time last year. Auction levels reached 40,000 recorded so far, with 30,000 sales being made. This will no doubt climb higher as the last wave of auctions hits the market before the end of the year.
This time of year has seen records break regularly. The weekend of the 28th of November saw the biggest number of auctions in one day across the country with 1,648 properties going to the auction market, according to the REIV. This number broke the last record by 22, set in October 2015. 5,669 auctions were held in November alone across the country. The previous record was set in November of last year.
According to the REIV, 2016 looks to be another strong year. It is worth remembering that 2015 has been a huge year in terms of capital growth and number of transactions.
The current auction clearance rates have been down slightly on previous months, but this is due to the huge amount of stock being brought to the market.
There is a lot to look forward to in 2016, with a “mix of population increases, a robust economy and relatively low interest rates is likely to also encourage buyer interest moving forward” according to the REIV.