Some 1,150 properties are set to go under the hammer on the October 27 weekend, marking Melbourne’s first super Saturday since April and the biggest since December 2010.
Melbourne auction listings have been down this year as many owners turned to private sales due to a flat property market.
But the recent rise in clearance rates could signal a turning point, Robert Larocca of the Real Estate Institute of Victoria says. A clearance rate of 66% was recorded on the weekend, compared with 51% for the same weekend last year.
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“There is a strong correlation between clearance rates and confidence levels,” he told the audience at the weekend Melbourne Home Buyer and Property Investor Show.
“These two factors are linked so when we see confidence drop so to do clearance rates,” he said.
“Clearance rates are a forward indicator of what’s happening to sale prices – with the clearance rate providing an indication of what’s likely to occur a few months later to prices.
“Right now we’ve seen a start in the rise to clearance rates, and that suggests, if history is any guide, that prices ought grow towards the end of this year and next year.
“That depends very much on the direction of the economy and also what’s happening around the word,” he advised.
“It’s a sign of emerging confidence given the vendors held back in the earlier part of this year … but we will soon see whether the gradual improvement in clearance rates are repeated and solid,” Larocca said.
Larocca said there had been little capital growth in the Melbourne market this year.
“The fact that prices haven’t gone down this year is good news,” he said.
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