…in a steady state market
Lower volumes of stock on the market in the past year have produced volatile but revealing median house prices.
The Real Estate Institute of Victoria released house price data over the weekend that shows the median price of a house in Melbourne has remained flat over the course of the year – a 2.9 per cent increase in the price in the June quarter cancelled a fall in the March quarter.
While the median price – $535,000 – is 5.3 per cent lower than it was 12 months ago, it remains 32 per cent higher than it was in June 2007. But only 90 of the 288 suburbs listed – 31 per cent – had more than the 30 sales in the June quarter to provide meaningful figures, which makes it difficult to extract solid information from the numbers.
However, the prices for suburbs with enough volume underpinning their results reveal interesting buyer activity. The median price of a house in the eastern suburbs of Balwyn, Camberwell and East Malvern increased in the June quarter while many of their flashier neighbours fell or remained flat.
Balwyn's median house price scored a 20.3 per cent increase for the past 12 months, to $1.54 million, while Kew increased only 0.3 per cent, to $1.34 million, and Hawthorn shifted 1.5 per cent, to $1.35 million. Camberwell performed better, with an 11.2 per cent rise to $1.39 million.
East Malvern increased by 6.7 per cent to $1.17 million in the past year while Malvern fell by 7.5 per cent to $1.65 million. Armadale shrunk slightly by 0.6 per cent to $1.37 million.
Stock numbers were down in nearby North Caulfield, where the median price fell by 8.6 per cent to $1.27 million for the year, and also in Toorak, where, conversely, the median price jumped 30 per cent to $2.88 million.
Fletchers Real Estate chairman Tim Fletcher said buyers started looking at suburbs like Kew and Camberwell and East Malvern when they were looking for value.
"You get more bang for your buck in Balwyn," Mr Fletcher said.
"If you pay $1-2 million you get a block of land and a pretty modest house in Kew and Hawthorn; but if you spend that money in Balwyn, you get a good block of land and a big house and a huge area for the kids."
The area was still close to private schools and had the added attraction of the highly regarded Balwyn High School, he said.
Other suburbs which performed strongly were Langwarrin, Cheltenham, Newport, Pakenham and Reservoir.
The data also shows that houses sold privately recorded an increased median price of 2.1 per cent, while the median prices of houses that sold at auction fell by 2 per cent. Fewer properties also went to auction, with the number falling to 30 per cent of all transactions, from 35 per cent.
Mr Fletcher said the natural consequence of a tougher market was fewer auctions. "An auction is all about competition. If you haven't got any competition, you haven't got an auction."
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