RBA: More Rate Cuts Threaten Financial Stability

Melbourne Auction Results 26th of February 2017
82% Clearance Rate 1198 Reported Auctions	Sold at Auction:	829
	Passed in:	215
	Sold Before:	154
	Sold After:	0
	Postponed	19

Source:REIV

 

Melbourne Market Wrap February 26th, 2017

A clearance rate of 82 per cent was recorded this weekend compared to 77 per cent last weekend and 76 per cent this weekend last year. There were 1198 auctions reported to the REIV, with 983 selling and 215 being passed in, 85 of those on a vendor bid. This weekend will mark 2017’s first Super Saturday and is on track to break the record for the highest number of auctions held in a single weekend in February. (REIV)

Massive Supply Hits Market

This was the first Super Saturday held over the weekend around the country. There was a record number of properties auctioned in Melbourne, Sydney and Canberra.

A record number of vendors put their homes up for auction over the weekend in Melbourne. Over 1400 homes were reported to go under the hammer up from 950 auctions the week before.

The three busiest suburbs were Reservoir (28), St Kilda (26) then Elwood (20). Stock levels are expected to continue til the end of March then take a pause for Easter and school holidays in April.

A reported 82% clearance rate looks good on paper but that’s from 1198 reported sales, with still 200 results yet to be accounted for we could expect a lower result. Nonetheless even with a drop of a 3-4% these numbers reflect the strength and demand for Melbourne property at the moment. Any result close to an 80% clearance rate indicates that we are enetering boom-time conditions. Data from Core Logic shows Melbourne’s total number of listings are down 7% when compared to the previous 12 month period.

Good stock is still being well inspected by buyers with some staggering auction results being witnessed. Demand is definitely outstripping supply. I’m seeing buyer advocates carrying a number of clients paying over the odds to make a pruchase. I am also seeing buyers who have been trying to buy a property the past two years still looking, these buyers would have seen property prices rise between $100,000 – $200,000 over this period of time. To many people’s surprise, good property in a good location is hard to find at the right price.

As banks clamp down on lending it appears more buyers are upping the ante. Young couples or singles can be seen at many opens with their mum and dad at their side. It makes me wonder whether parental funding is helping push prices up further?

 

Source: PIXABAY

 

RBA: More Rate Cuts with Threaten Financial Stability

The Reserve Bank Governor addressed parliament last week stepping up his focus on Australia’s financial stability.

The gist of his speech was that he remained concerned about rising household debt levels with little or no wage growth. Mr Lowe discussed the challenges of stimulating the Australian economy further and creating a potential “dangerous” situation, as a result of further rate cuts.

The challenge facing the RBA is lowering interest rates further to stimulate the economy as mining investment and construction slows down and non mining investment proves elusive.

Reducing rates further according to the RBA, would not fund more consumption as required for a 2-3 percent GDP growth this year but instead most likely push debt levels for property up further. Australia’s debt levels relative to income, hit a record high in December and is among the highest in the world.

More consumers are borrowing to purchase property as a result of record low interest rates, generous tax concessions and foreign demand.

The RBA will need to carefully navigate the prospect of stimulating the Australian economy while at the same time control the genie in the  bottle that is the property bubble.

Street Advocate – Property Results a Mixed Bag

Congratualtions to our wonderful vendors Joe and Diane who sold their family home in Roxburgh Park for $35,000 over reserve in front of a 30 plus crowd.

Now we are on the hut to find them an inner city town house!

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Feel free to call me if you have a property question on 0418 740 606 or 9863 7514

 

Street Advocate Client Reviews

Peter,

Just a short note to thank you once again for your help in selling the property.

Dealing with you Peter was a pleasant experience, you were very professional with all aspects of the sale including:

·         Your knowledge of the real estate industry

·         Negotiating down the agents fee.

·         You understanding what marketing campaign was needed and directed the agent accordingly

·         Keeping me up to date by communicating via phone, text , email and weekly meetings

Not only will I use you in the future but I would have no problem recommending other vendors to you.

Thanks once again, Arnie Nuzzo

6 Highett Rd, Hampton

 

Thinking of buying or selling a home?

Visit our Street Advocate website or send an enquiry below or just call

Peter Sarmas on 0418 740 606.