Our highly anticipated first property update webinar for 2022 saw over 100 real estate agency leaders join Adam Holster, Professional Services Banking Executive Victoria to hear the latest insights.

Mark Browning – NAB’s Head of Valuations & Property Advisory and Martyn Boyle – Director of Charter Keck Cramer share property market and real estate agent market insights and outlook.

The Melbourne market has continued to stabilise in early 2022, after seeing record levels of value growth and sales activity through much of 2021. Melbourne housing values rose by +17.9% across calendar year 2021, with an unprecedented level of demand continuing to outweigh supply and supported by the record low interest rates on offer.

Focusing on early 2022, a softer start to the new year has been observed and measured. While demand remains healthy, rising listing numbers, potential interest rate rises, and worsening affordability concerns have impacted on buyer confidence. While both new for sale listings and total for sale listings now sit higher than the same time last year, up +14.9% and +7.7% respectively overall, sales activity sits well up over the same period, up by more than +50% above the same time last year.

More broadly vacancy rates are continuing to reduce, and rental growth remains strong, overall up 5% over the last year, with unit rents now outpacing housing rental growth over the last 12 months.

Local Melbourne Regions

For the 12 months to February, activity in almost all metropolitan regions of Melbourne has seen sales activity increase by more than +35%. The strongest uplift in sales activity has been seen in the Inner East, where an increase of more than +50% has been measured compared with the same time last year, whilst Melbourne – Inner, Inner South, North East and West, have all seen more than a +46% uplift over the last 12 months.

The strongest value gains in house price growth over the 12 months to February has been seen in the Inner South, Outer East and South East, with house values across these regions rising by between +15.3% and +17.3% over the last year.

Over the last quarter, house value growth is being led by Melbourne – West, North West and Outer Melbourne – South East, with these regions recording between a +1.3% to +2.2% value increase.

Unit growth over the last year has seen the strongest value growth achieved in outer suburban areas, with the North East and Outer East achieving value growth in excess of +10%. The Melbourne – Inner region, home to a high number of investor-owned units, has seen a +6.9% value gain over the past 12 months, despite the challenges faced by this market particularly due to international border closures up until recently.

Market indicators

New listing levels for houses across Melbourne are up 12% and for units up 18% on a year ago, with total listings now also higher than the same time last year.

The uplift in new listings being brought to market, has resulted in a surge in auction activity across Melbourne. Late January, February and now into March 2022 have seen auction numbers surpass previous highs for this time of year, with auction clearance rates hovering in the high 60% range, which underlines and reflects that healthy levels of demand are still apparent within the market.

Outlook

For agents the level of rental stock remains front of mind with many landlords taking the rise in value as an opportunity to sell their investment property.

Affordability and interest rate outlook are both key indicators of the market together with the range of listings and options for purchasers.

As the year progresses international migration and travellers will join international students again as influences of property demand.

If you missed the webinar – you can watch the recording here.