Archive for July 2010 | Monthly archive page
THE completion of EastLink and the first home buyers’ grant has seen property prices boom in Melbourne’s eastern and south-eastern suburbs.
The Valuer-General Victoria, Robert Marsh, released his two-yearly general revaluation of 2.6 million Victorian properties, valuing the state’s residential, rural, commercial and industrial properties at a whopping $1.26 trillion, up 20 per cent in two years.
The Valuer-General uses land and market values to price properties and the results will be used by the state’s 79 councils to calculate rates from July 1 this year.
“It’s important to keep in mind, that an increase in values does not mean an increase in rates,” Mr Marsh said.
The total value of the 2.1 million residential properties assessed rose 20 per cent to $976 billion; the median house price jumped from $399,000 in June 2007 to $460,000 in June this year.
The Valuer-General’s spokesman, Greg Stevens, said properties in in the outer Melbourne suburbs neighbouring the Peninsula Freeway and EastLink had also jumped more than 20 per cent in value, and were singled out as the city’s prime moving real estate, particularly for first home buyers.
“They were the big movers in the revaluation this time around,” Mr Stevens said.
“There’s no doubt the property prices have clearly shown a direct relationship to the first home buyers’ scheme.
“It’s on the Peninsula Freeway arm, in areas such as Pakenham, Berwick, Narre Warren, Rye, Tookarook; they were low-value properties, and their values certainly increased at a faster rate than the average dwelling.”
Dandenong real estate agent Doriano Del Monaco, from Century 21, said it was no surprise that people were heading southeast, saying: “A lot of people are moving this way for a sea change. There’s quick access to the city, which they didn’t have before EastLink was completed in 2008.”
Real estate in the northern suburbs also saw impressive growth of more than 20 per cent. Inner-city Melbourne enjoyed a smaller surge of 5-10 per cent.
The median metropolitan house price has risen an impressive 121 per cent in the last decade; rural property prices had increased 131 per cent.
Bass Coast Shire had the largest growth in the state: 196 per cent since 2000.
The clearance rate from this weekend’s 560 auctions was 67 per cent, a result that is remarkably consistent with the past few weeks indicating that the market has settled at a new level this winter.
Buyers continue to have the upper hand; homes selling at auction are not exceeding vendors’ reserves in the same way that they were before Anzac Day.
There were a total of 560 auctions reported this weekend with 375 selling and 185 being passed in, 123 of those on a vendors bid.
This weekend last year saw a total of 382 auctions held and clearance rate of 86 per cent achieved, higher than this year but with fewer auctions.
The next 3 weekends have around 550 auctions each weekend with a drop the following weekend, to around 130 at this moment, due to the Federal election.
The performance of the residential auction market improved marginally from last week with a clearance rate of 72%, compared to last weeks of 67%.
There were a total of 497 auction results of which 357 were sold, and 140 passed in, with 88 of the 140 being on vendor bids.
The corresponding weekend last year saw 293 auctions being held, and a clearance rate of 85%.
Listings remain high with approximately 1200 dwellings to be auctioned in the next two weeks.
Melbourne Median House Price Trends June 2005 to March 2010
What is a Median Price?
The median price is the middle price in a series of sales. For example, if fifteen sales are recorded in a suburb and arranged in order from lowest to highest value, the eighth sale price is the median price. In the case where there are an even number of sales in a series, the median is the average of the middle two prices.
Median prices are used rather than average prices because median prices are unaffected by a few unusually high or low prices, making them a more accurate indicator of true market activity. The lower quartile is the point where one quarter of the sales are of lesser value and the upper quartile is the point where one quarter of the sales are of a higher value.
Median prices are a guide to market activity, and the REIV does not intend for median prices measures to be regarded as a valuation tool. The assessment of an individual property’s value is a job for a qualified professional, who possesses the knowledge, experience, and comparable sales information required to do so.
Market Overview
There were 528 auctions reported this weekend with a total of 361 selling and 167 being passed in, 96 of those on a vendors bid. The clearance rate from this weekend’s auctions is 68 per cent. This weekend last year saw 293 auctions reported and a clearance rate of 85%. Next weekend the REIV expects 590 auctions.