Melbourne home prices are tipped to increase by up to nearly 10% across the next 16 months, according to Australia's big four banks, with NAB the most bullish about the price growth.
Of the four major banks, ANZ was the most cautious, forecasting dwelling values in Melbourne to slip by less than 0.5% by the end of 2023 before lifting by 1% next year.
Westpac is predicting Melbourne home prices to rise by 3% for the remainder of this year and by a further 4% in 2024, the Herald Sun reported.
CBA’s data hinted at a 3% increase before the end of December, followed by a 6% jump next year.
NAB is the most optimistic, predicting Melbourne prices to grow 2% by the end of 2023, followed by a 7.4% surge next year, which combined equalled to a total 9.4% increase.
The news came as PropTrack data showed Victoria delivering a preliminary 68.3% clearance rate this week from 435 early auction results.
PropTrack figures also showed that in Melbourne, the median house price was $875,000 and the median unit price was $595,000.
Nerida Conisbee (pictured above), Ray White chief economist, said home prices would be “a bit wobbly” for the remainder of 2023 but would perhaps increase in the new year – especially if interest rates were reduced.
“There’s a lot of properties coming to the market at the moment and that’s coincided with the mortgage cliff, which the CBA have said will peak this month,” Conisbee said.
Jarrod McCabe, Wakelin Property Advisory director, said that for more positive projections, not only would the clearance rate have to rise, but interest rates would also need to be slashed.
“And to see those growth figures it would need to be more than a quarter per cent,” McCabe said. “Probably 0.5%-1% to get to almost 10% growth.”
With what was happening in today’s auction market in mind, he was confident that ANZ’s 1% growth forecast would be met and exceeded.
Mike McCarthy, Barry Plant executive director, said that if the federal government’s recent target of building 1.2 million new homes over five years from July 1 proved successful, “it would inject a certain level of confidence back into the housing sector.”
“There’s still big issues to address in terms of both labour and materials, it’s not just a matter of addressing long planning processes and cutting back on red tape,” McCarthy said.
Among the top results over the weekend was a renovated circa-1890s four-bedroom house at 3 Chrystobel Cres, Hawthorn, which fetched $7.4 million – $1.9m higher than its $5m-$5.5m asking price’s upper range.
Hamish Tostevin, Marshall White director and auctioneer, said the result exceeded both their and the owner’s expectations.
“There were two bidders and a family bought it,” Tostevin said. “We thought it would be competitive, but not that competitive.”
Just around 5km, a house at 38 Power St, Balwyn, sold for $3.2m, which was $120,000 above the $3.08m reserve.
Helen Yan, of Ray White Balwyn, said the auction winners were planning to knock down the existing home and build the family’s dream property.
“The market has been very tough at the moment, things are definitely taking a lot more work at the moment, but we got this one sold, and the vendors are very happy with the result,” Yan said.
A luxurious three-bedroom apartment at 302/2 Gascoyne St, Canterbury was snapped up at $2.36m – up $360,000 from the $2m reserve, the Herald Sun reported.
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