Our Market - August 2024
As winter takes its final bow and the warmer breezes of spring start to tease, the real estate market is gearing up for its busiest and most exciting season of the year. With the cooler months fading into memory, it’s time to see how the market is adjusting to the new season!
Homeowners had reason to celebrate this August as the Reserve Bank of Australia (RBA) opted to keep interest rates on hold. After weeks of speculation about a potential increase, this decision offered a much-needed respite and stability in a market that’s been feeling the pinch of uncertainty. Overall, August was an active month albeit somewhat patchy and uncertain, however, it was still marked by some impressive sale prices and healthy buyer activity. Here’s a snapshot of how the market performed (in brackets is the same month last year)
Sold at Auction = 71 (47)
Sold Prior = 44 (37)
Passed in at Auction = 21 (16)
Withdrawn from Auction = 14 (12)
Auction Clearance Rate = 77% (75%)
Sold by Private Treaty = 50 (34)
Whilst the overall auction clearance rate for August remained respectable at 77%, when we drilled down on the weekly clearance rate it underscores the patchiness and uncertainty in the local real estate market, potentially reflecting fluctuating buyer confidence. Weekly auction clearance rates ranged from 59% to 92%, demonstrating substantial variability. This inconsistency makes predicting how the market will unfold in the Spring challenging. We will monitor these trends closely to better understand their implications for future market conditions. Please see below the weekly auction clearance rates in our local market for August;
Aug 4th - Auction Clearance Rate = 71%
Aug 11th - Auction Clearance Rate = 87%
Aug 18th - Auction Clearance Rate = 92%
Aug 25th - Auction Clearance Rate = 61%
Aug 31st - Auction Clearance Rate = 59%
While stock levels have been low for the balance of the year, we have seen an uptick in new listings in the last couple of weeks. This is expected, as we enter the most active selling season of the year, this increase in volume will be welcomed by buyers. Given the volatility influencing the market, it will be interesting to see how it responds to the increase in supply. Inflation remains a concern, though there’s a glimmer of improvement. July’s Consumer Price Index (CPI) indicator rose by 3.5% over the past year, a slight decrease from the 3.8% rise recorded in June. This minor dip offers a hint of relief in an otherwise stubborn economic landscape.
Inflation falls to 3.5pc in July as energy rebates help to push electricity prices lower - ABC News
Australia’s major banks have been in the spotlight recently, announcing reductions in some of their interest rates. However, these cuts were selective—affecting term deposits with some banks and home loans with others. This development came just days after the RBA reiterated that they’re not in a hurry to lower rates, leaving the market with mixed signals.
Why bank are cutting interest rates
CBA: ASX – CBA cuts interest rates for new borrowers reigniting mortgage wars (smh.com.au)
While the overall real estate scene remains unpredictable, there is still good news as we are still witnessing a healthy flow of buyers, and many properties are achieving commendable results. In an interesting turn of events, Wilson Street Newtown/Darlington has emerged as the standout performer this August. Our team at Raine & Horne Newtown has been busy securing impressive results for our clients in this area. Here’s a glimpse of the Wilson Street activity:
1. 223 Wilson Street, Newtown: This well-presented 2-bedroom terrace was a hot ticket, attracting 178 buyers over a 4-week auction campaign. With 23 contracts requested and 8 bidders vying for the keys, it sold for an incredible $2,300,000—far exceeding expectations.
2. 41 Wilson Street, Newtown: An unrenovated 3-bedroom, 2-level terrace also saw fierce competition. On auction day, 6 bidders pushed the price to an unexpected $1,670,000, showcasing the strong demand in this area.
3. 354 Wilson Street, Darlington: Even a petite terrace on just 51sqm of land drew significant interest. Perfect for first-time buyers, this property didn’t even make it to its scheduled auction day, selling before auction for a figure the owners simply couldn’t refuse, $1,535,000.
4. 66 Queen Street, Newtown: Although not on Wilson Street itself, 66 Queen Street deserves a mention as it's just 50 metres away. On auction day, the property saw an exciting competition between two determined bidders, driving the final sale price well beyond expectations to a remarkable $2,380,000.
As we step into spring, the real estate market is showing positive signs, with Wilson Street leading the charge. Whether you’re buying, selling, or just keeping an eye on the market, it’s an exciting time to be involved in real estate. If we can help at all, please don’t hesitate to reach out. Stay tuned for more updates and happy property hunting!