Melbourne’s auction market could be set for a bumper weekend if historic interest rate hike fear patterns repeat.
Melbourne’s home sellers could be set for a surprise boost this weekend, with historic clearance rate data showing auction sales rates rise in the face of an expected rate hike.
Auctioneers also believe that even with forecasts of grim news for owners ahead, this will be a “great weekend for sellers”.
On May 4, 2022, the day the Reserve Bank raised rates for the first time since 2010, PropTrack records show the city’s auction clearance rate from the prior week was 85.5 per cent.
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Seven days before that it was 80.1 per cent.
The RBA raised rates for nine of the following 10 months, before putting them on hold in April 2023.
A month later, when the RBA hiked again on May 3, 2023, the clearance rate rose from 67.3 per cent the fortnight prior to 68.2 per cent in the week leading up to the hike.
The last time the Reserve raised rates, November 8, 2023, the clearance rate dropped to 59.6 per cent from 61.7 per cent for the week leading up to November 1.
Melbourne’s auction market will kick off for 2026 with the possibility of a rate hike looming.
But with that weekend included the Melbourne Cup pseudo-long weekend, when clearance rates regularly fluctuate due to extreme reductions in auction numbers.
PropTrack data shows there were 648 auctions scheduled across this week, though many were slated for twilight sales during the week, and Ray White Victoria chief auctioneer Luke Banitsiotis believes they’re set for a win.
Mr Banitsiotis said both the stats and a wider market trend of less homes for sale than buyers looking to acquire them suggested this weekend should be a bumper one for sellers, despite grim forecasts for mortgage holders next week.
“Generally there’s a group of people looking to lock in an offer prior,” he said.
Ray White Victorian auctioneer Luke Banitsiotis says auctions should be strong this week.
The auctioneer said after calling 15 auctions during the week, 10 had sold under the hammer and a number of the remainder were expected to be negotiated to a sale shortly.
“I don’t think the Reserve Bank going north will be a big surprise,” he said.
“So I think the market will perform at the same level, if not a little better.
“And by what I have experienced in the market, this should be a great weekend for sellers.”
But if the RBA looks set to hike again at their next meeting on March 17, the clearance rate is likely to suffer – with PropTrack stats showing they fell every month for the rest of 2022 barring December when they rose modestly to 57.2 per cent.
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