Weekend auction results hold promise for spring vendors
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Weekend auction results hold promise for spring vendors

Auction numbers, clearance rates on the up as spring market warms

By Robyn Willis
Mon, Oct 10, 2022 9:54amGrey Clock < 1 min

Last weekend continued to see improvement in both the number of houses up for auction and their clearance rates, CoreLogic reports.

After market disruptions caused by football grand finals and public holidays, the market once again found its feet, with 1,799 homes going under the hammer across the country over the weekend. This represents a 11.2 percent increase on the previous weekend and 36.7 percent higher than the weekend prior to that.

Melbourne led the way last weekend, with 721 homes going under the hammer, with a clearance rate of 68.4 percent, the highest since May. In Sydney, 686 homes were auctioned, up 41.7 percent on the Labour Day long weekend the previous week. Clearance rates also improved, with 61.3 percent of homes being sold, the highest rate since August. However, withdrawal rates in Sydney also increased from 17 percent to 21.1 percent, showing vendor uncertainty remains.  

The smaller capitals all experienced greater auction activity, except for Perth. No auctions were held in Tasmania.

While the steady rise is encouraging, head of research at CoreLogic Tim Lawless points out numbers are not as strong as the same time last year.

“There has been a consistent improvement in the auction success rate since the last week of July when the combined capitals clearance rate was recorded at 51.9 percent (based on finalised numbers),” Mr Lawless said. “Melbourne came in at 66 percent, Sydney and 61 percent and Adelaide nearly broke the 70 percent mark this week based on the preliminary numbers.

The volume of auctions is holding lower than last year – a reflection of less stock flowing onto the market, as well as more vendors choosing to use a private treaty campaign over auctions.”



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Expert tips for prospective buyers looking to purchase a home in 2024.

By Josh Bozin
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For aspiring homeowners, be it a first-time buyer, downsizer, or investor, picturing your idea of homeownership bliss is the easy part. But before deliberating on furniture choices or scouting for that perfect neighbourhood coffee, understanding your purchasing power stands out as the most important step in ensuring your success in homeownership.

And with the Australian property market gaining momentum in 2024, there’s never been a better time to come to grips with your financial options.

In 2023, amid the changing financial landscape that saw rising interest rates and the cost of living skyrocket, among other factors, the total amount borrowed for property purchases across Australia was estimated at $300.9 billion, a 12.7 percent decrease from the previous year, according to PEXA’s latest Mortgage Insights Report.

Each mainland state also experienced a decline in new lending, according to the report, with Victoria and New South Wales seeing the biggest drops to $84.1 billion and $109.5 billion, respectively.

While this trend reflects the repercussions of such financial hardships on the everyday Australian, John Morello, director and auctioneer at Jellis Craig, said we’re seeing renewed confidence in the property market during the first quarter of 2024, particularly in Melbourne.

“Auction clearance rates have started the year strongly and consumer sentiment is rising. This lift is driven by cooling inflation and an improved outlook on interest rates. At Jellis Craig, as with the rest of the market, we are experiencing an increase in volume of property compared to the same period in March last year (up 28% in 2024),” Mr Morello said.

“Melbourne’s property market, in particular, is showing its ongoing evolution and resilience.”

PEXA’s report revealed that, while borrowing saw a decrease in 2023 in Australia, Australians still invested $613.0 billion in property purchases in 2023. In 2024, purchasing confidence is only going up, as prospective first home buyers, seasoned downsizers, and savvy investors look to capitalise on a flood of new property hitting the market, coupled with the lowering of interest rates across the board.

“With more certainty in the economic outlook, along with an increase in volume of property available, we are seeing these factors translate to early signs of a boost in confidence in both buyers and sellers,” said Mr Morello.

“Further encouraging data shows that whilst there is more property available to purchase, more people are inspecting property, again indicating that demand has increased broadly across our marketplace.”

If you’re in the market for a new property, the biggest question you must ask yourself is how much house can I afford?

A great starting place is to speak with your mortgage broker or financial professional, who can guide you on your lending options. This is critical, as you need to know what your future repayment options might look like, and ultimately, what you will typically be able to afford.

A useful tool for judging whether you can afford a specific property is to factor in the 28/36 rule — a rough guide that suggests you should not spend more than 28 percent of your gross monthly income on housing, and no more than 36 percent on all debts. Another useful tool is the idea of a debt-to-income ratio (DTI); a formula whereby an individual can divide all of their monthly debt payments by gross monthly income to arrive at a number that one can measure as a way of managing monthly mortgage payments.

Mr Morello emphasised the need to understand affordability and what’s feasible for each individual when looking to make a purchase, no matter the budget, on a property in 2024.

“It’s pivotal to work out what you can afford. Get your finances in order. Consider all associated costs with buying, and research what concessions and grants are available,” said Mr Morello.

“It’s easy for individuals to begin the process today. Start actively searching potential properties on a weekly basis, and research areas you are interested in. Check weekly sales results, attend inspections and auctions, to get a feel for the process. Just remember, it’s important to be really comfortable in understanding your living expenses, and what the ongoing expenses will be once you have bought a property.

“For example, mortgage repayments, council rates, water, power, owners corp fees, insurances, maintenance costs; if you are buying as an investment, the Land Tax payable on that property which is an ongoing tax. There’s many factors to consider.”

To see what’s possible for your specific circumstances, visit our Finance Portal for specific tools, guides and tips—as well as our own mortgage calculator—to assist you on your property journey.

 

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