Article by Peter Farago 03 SEP 2019
HOMEOWNERS could start September with a spring in their step on the back of new data suggesting the short correction in Geelong house prices is coming to an end.
The latest CoreLogic Home Value Index released on Monday shows Geelong dwelling values rose over the past quarter, the first increase in values since late 2018.
The increase in local house and unit values comes on the back of the first national rise since October, 2017.
Geelong dwelling values jumped 1.6 per cent in August to a $542,477 median — a one per cent increase over three months.
While the value is 3.4 per cent below the same time last year, the level of annual decline has slowed from previous months.
CoreLogic research director Tim Lawless said evidence of growth returning to areas such as Geelong may well be a hint that the value growth occurring in Melbourne is already beginning to spill over into nearby regions.
He said the significant lift in values nationally over the month aligns with a consistent increase in auction clearance rates and a deeper pool of buyers at a time when the volume of stock advertised for sale remains low.
“It’s likely that buyer demand and confidence is responding to the positive effect of a stable Federal Government as well as lower interest rates, tax cuts and a subtle easing in credit policy,” Mr Lawless said.
Geelong’s auction clearance rate of 77 per cent bettered Melbourne last weekend, albeit with fraction of properties offered.
Analyst Cameron Kusher said cuts to interest rates and changes to lending rules had stimulated the market by helping increase people’s borrowing capacity.
In recent weeks, Advertiser reporters have witnessed a lift in the number of buyers bidding at auctions, with properties selling as much as $200,000 over the reserve price due to the competition.
Whitford, Newtown agent Dale Whitford said it was a sign confidence was returning to the market.
“Usually coming off what would be considered in the media a softer market, the last people to return are the vendors,” Mr Whitford said.
“I think they’re starting to get that idea. We’re looking at a lot of property at the moment where people are saying after the footy we’re on the market.
“There will be a bit of a plunge in terms of the number of properties on the market after the footy.
“We’re seeing a lot of buyers out there who aren’t being satisfied because of a lack of stock. It will be interesting to see when the stock comes on volume what happens then.”