The Melbourne auction market’s strange reaction to inflation data – realestate.com.au

A looming Melbourne Cup holiday and grim inflation figures that experts say have ruled out a rate cut on Tuesday did little to hurt home sales yesterday.

But they may have turned off a few buyers.

PropTrack data shows that 65.4 percent of the 408 auction results reported yesterday ended in a sale, with a preliminary clearance rate suggesting buyer demand has not shifted from all of spring.

But separate data from Victoria’s largest property company, Ray White, shows the number of registered bidders fell from 3.4 per cent to 2.7 per cent in the past week.

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Sales performance manager Jake McIntyre said that with an internal approval rate above 70 per cent, slightly above the year-to-date trend, the buyers who did go through this week were “probably the most serious”.

Mr McIntyre said both inflation data released last week showed a rise in the consumer price index, which most experts say means the Reserve Bank is now unlikely to cut rates on Tuesday, and that the long weekend could have reduced the number of registered bidders.

29 Audley St, Coburg, was among the top results for Ray White yesterday, selling under the hammer for $1.025 million – with six bidders present.

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PropTrack senior economist Eleanor Creagh said Melbourne house prices were likely to continue rising for the rest of the year even if the Reserve Bank did not cut interest rates further.

This suggests that sellers will remain in control even if buyers don’t get another budget increase before Christmas.

However, Jacob Caine, acting CEO of the Real Estate Institute of Victoria, said he had heard from agents in the city that many sellers had tried to lock in the sale before the auction, rather than risk coming in over the weekend and losing momentum if the Reserve Bank kept mortgage costs steady on Tuesday.

24 Chapman Blvd, Glen Waverley, was Melbourne’s highest priced auction sale reported to PropTrack, with a result of $3,701 million.

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“But given the context of a virtual long weekend and the commentary around monetary policy, I would consider a mid-high 60s result a success,” Caine said.

Although the number of auctions testing the market fell this week, PropTrack forecasts show this is expected to rise again to more than 1,500 auctions over the next two weekends.

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