In auctions on the weekend in Sydney, more than 84 per cent of homes offered were sold for a total of $151 million — leaving less than 16 per cent of homes without a buyer. This was well up on the same period last year when only 60 per cent of homes auctioned in Sydney were sold. There were also more homes offered this year, at 296 for the weekend compared with 168 on the same weekend in 2013.
In Melbourne, clearance rates were a solid 75.6 per cent, boding well for a market many economists tipped to struggle this year.
Melbourne’s residential property market surprised most economists during the week, with RP Data-Rismark figures showing monthly January price growth of a soaring 3.2 per cent, bringing growth for the year to January to nearly 12 per cent.
Australian Property Monitors senior economist Andrew Wilson said the Reserve Bank interest rate halt last week had stoked buyer appetite. He said the lowering of interest rates by major lenders was even more significant.
“The Sydney market has got no sense of stopping at the moment. There’s been no pause for reflection over the holiday break,” Dr Wilson said. “The type of growth we’re getting now, at 6 per cent a quarter, is unsustainable, but we must remember how low interest rates are now which has pushed down the repayment on the average loan.”
Dr Wilson said that there was no bubble emerging as banks were stringent on the loan-to-value ratio. Housing unaffordability would moderate price value growth in the back end of the year, although a lot would depend on the…