Melbourne auctions have yet to respond to an interest rate cut.
Victorian homebuyers are still in charge of the state’s auction market more than a month after an interest-rate cut that was projected to change sellers’ fortunes.
PropTrack clearance rate data shows that before the Reserve Bank’s February 18 decision, 64 per cent of all homes testing the market were sold under the hammer.
Of the 1239 auction results reported for the past weekend, only 532 were declared sold under the hammer. A further 210 sold ahead of auction, and another 36 were lodged as post-auction sales by Wednesday.
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Combined, it equates to a 63 per cent clearance rate, despite an about $11,000 increase to the borrowing capacity of a family that could get $500,000 from their lender before the cut.
This weekend there are 1204 homes scheduled to go to auction.
PropTrack economist Anne Flaherty said while preliminary figures recorded on Saturday had looked stronger at times since February 18, the final clearance rate recorded midway through the following week hadn’t really moved beyond 64 per cent since the rate cut.
Ms Flaherty said with “relatively robust” auction numbers above 1000 recorded every week except for the Labour Day long weekend, the volume of homes for sale would be a factor in the clearance rate.
The 70-72 Beaumont Rd, Berwick, home once owned by Australia’s first Olympian Edwin Flack goes under the hammer at noon with a $2.3m-$2.5m asking price.
“On February 18, after the RBA (Reserve Bank) cut announcement, we had the most visits to realestate.com.au in a single day for three years,” she said.
“And for the week after the cut, it was 25 per cent up.
“But movement in the clearance rate should be a bit slower in Melbourne’s market, as it’s a recovering market and so it will take time.”
Real Estate Institute of Victoria president Jacob Caine, who had anticipated a change in direction of the clearance rate sooner, said there were high numbers of people at open homes and more bids at auctions since the cut, as well as more conversations from people looking to buy ahead of auction.
Despite recent statistics, 59 Oxford St, Newport, is tipped for a competitive auction with interest from homebuyers and developers. It will test the market at 10.30am.
However, Mr Caine said most homes were still selling within their advertised range or only slightly above reserve.
“While the tide is turning, clearance rates in the mid 60s represent a good opportunity for buyers … it hasn’t flipped to be a sellers market yet,” he said.
A sellers market is generally regarded as one where the clearance rate tops 70 per cent.
Buyer’s advocate Amy Lunardi concurred that so far this year there had been a significant shift in buyer activity and confidence on the ground in comparison to the last quarter of 2024, despite the ongoing lower clearance rate.
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