Melbourne home values rise for second time since 2017

Melbourne’s home values have risen two months in a row.

Melbourne’s home values have risen for a second consecutive month, signalling the worst of the market downturn is over.

Experts say the increases recorded in June and July — the first positive results since November 2017 — should spur house hunters into action before prices potentially lift in spring.

CoreLogic figures show house and unit values crept up about 0.2 per cent in July, closely matching the result recorded in June.

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42 Old Orchard Drive in Wantirna South sold after nearly a year on the market.

Melbourne notched 18 straight months of decline before this.

The Hedonic Home Value Index showed the city’s values had fallen 8.2 per cent in the year to July to hit a $619,443 median, with a 1.6 per cent drop in January the largest monthly fall of the downturn.

CoreLogic head of research Cameron Kusher said it was promising to see month-on-month growth.

3/7 Campaspe St, Box Hill North sold at auction last week for $1.04 million.

Four bidders pushed the townhouse $80,000 above reserve.

“It probably indicates the market is stable and the worst is really over,” Mr Kusher said.

“Obviously we’re getting pretty close to spring, which will be the real test for the market.”

He attributed the market improvement to recent interest rate cuts and the Australian Prudential Regulation Authority loosening lending requirements.

“It means people have got an increased borrowing capacity, which could make it a good time to upsize on the market,” he said.

“The value of bigger homes has fallen by a larger amount and they are more affordable at the moment.”

Auction clearance rates have hovered at about 70 per cent. Picture: Nicki Connolly

More stock is expected to hit the Melbourne market in spring.

Mr Kusher said renewed buyer confidence should help keep the market improving into spring, when more housing stock was likely to become available.

Sydney and Brisbane also notched 0.2 per cent dwelling value rises in this month.

Further CoreLogic data shows last week’s 74 per cent preliminary clearance rate from 458 auctions was the best result Melbourne had seen since January 2018.

Five bidders competed for 81 Little Page St, Albert Park.

It sold for $1.51 million.

Greville Pabst Property Advisory chief executive Greville Pabst said first-home buyers were driving the market and next year’s government deposit scheme would further fuel momentum.

“It’s why regional areas are really starting to perform well,” Mr Pabst said.

Among Australia’s top regional markets in the past year were Warrnambool and south-west (up 2.6 per cent) and Bendigo (2.3 per cent).

Mornington Peninsula has been the worst performing Victorian region. 10 Kalimna Drive, Mornington is for sale.

Melbourne’s Mornington Peninsula has been the state’s worst-performing region, with values down 11.1 per cent, followed by the inner east at 11 per cent and the inner south, 9.9 per cent.

Mr Pabst said population growth would help boost house prices in the future, particularly in the city’s west, where properties were still relatively affordable.

Original Article – https://www.realestate.com.au/news/melbourne-home-values-rise-for-second-time-since-2017/

jayitri.smiles@news.com.au

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