june property report
THE MARKET KEEPS MOVING
Winter is fast approaching with the frosty mornings and unpredictable rain fall in full swing, earlier than hoped for this year. Looking back at the April to May period, the market was busier and more competitive than ever. However we are expecting a slight decline in activity moving into the cooler months of Winter.
The auction clearance rate across Melbourne is sitting at an impressive 88%, that’s a huge 23% increase from last month with just over 800 properties sold at auction and another 1585 properties sold privately. These levels are being retained across Melbourne as supply and demand remains with the Melbourne Metro average surpassing $1 million. Jobs are strong and there is good cashflow in the economy keeping everything afloat.
Popular properties within the region remain predominantly entry level properties in townships on large allotments suitable for first home buyers or small families as well as families looking to upsize to acreage allotments.
After a tumultuous 2020 where the world as we knew it changed forever, it is wonderful to finally hear that the rental vacancy rates are shifting again, signalling people are returning to the cities and life is adjusting to the new ‘Covid normal’. All capital cities apart from Melbourne, experienced a decline in rental vacancies over the past 12 months with Hobart recording the lowest vacancy rate at 0.5% with Adelaide and Darwin following close second and third. Melbourne and Sydney however, still remain higher than pre-pandemic levels. These promising rental rates suggest the worst effects of COVID-19 could be over for landlords with the demand increasing and lack of new rentals available.
Comparatively to the Victorian market, South Australia is also experiencing record breaking volume of sales with an increase of 1.51% in median price from last quarter resulting in the increased average price of $518,000 across metropolitan Adelaide. Adelaide’s market has a startling similarity to Melbourne’s regional market statistics. Melbourne has also experienced substantial growth with an increase of 4.4% over the past three month. These results have clearly indicated a resilience in the real estate market across the board.
Despite the resurgence in the market and prices reaching these levels, there is always a downside. Housing affordability is becoming an unrelenting concern for first home buyers and single parents, in particular as values continue to rise, so what is the government doing to assist?
The recent release of the 2021 federal budget has confirmed incentives such as the $2.5 billion HomeBuilder scheme. Another new incentive to the budget release to assist single parents buy a family home includes The Family Home Guarantee program with 10,000 positions will be released from 1 July 2021. This scheme aims to help single parent families with an income of less than $125,000 purchase a home with a deposit as little as 2% making purchasing a home a lot more accessible. This is a stark contrast to the normal 20% deposit required to avoid lenders mortgage insurance.
It is fair to say on behalf of the wider community, we are all pleased the economy is getting back on track and can start the long road to recovery with a positive outlook on the months ahead. Employment rates are growing and vaccination roll out will build confidence as public health restrictions continue to ease. It won’t be long before families will enjoy the winter holidays, whether it be in the high country, on the ski fields, escaping to warmer weather, or getting things done at home.
Thank you to all of our clients past and present for your continued support and we look forward to updating you in next month’s edition.
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