Despite the headlines created by the COVID-19 crisis, the Melbourne property market is managing to weather the storm.
Data released by the REIV has shown that Melbourne house prices have remained resilient throughout the current crisis and the outlook is positive.
Looking at the latest figures from the REIV Residential Market Index (RMX), which give insights into the real property price trends in Victoria, shows that so far there hasn’t been a major fall in property values.
The RMX has been gradually declining since late March due to the Coronavirus outbreak, which saw significant restrictions enforced on real estate. Although for now, residential prices in Victoria are still stronger than the same period last year.
RMX Index: Source: REIV
During this same period last year, property values were under pressure as the possibility of a Labor victory at the polls and the removal of negative gearing tax benefits was denting sentiment in the real estate industry all around the country. In comparison, the index is suggesting that things are looking better than they were during the pre-election buildup.
In fact, In mid-March this year, the price index was heading into possible new record levels. This is based on the prices recorded a couple of weeks before the restrictions came into effect.
REIV President Leah Calnan noted, “There are many predictions circling about real estate and the economy in general, but looking at what the actual data tells us, the Victorian market is weathering the storm well. At this time, prices are not as affected by the Coronavirus pandemic compared to sales volume, which remains much lower than expected at this time of year. ”
“The Victorian market continues to show strong resilience, with the return of public auctions and easing of some restrictions, we expect transaction volumes to start building soon .”
The positive news on property prices comes as auction markets continue to recover. Last week, the auction clearance numbers in Melbourne were back at nearly 70% according to CoreLogic.
This week there is another increase in the number of properties going to auction and vendors are getting more confident that they will be able to achieve strong results in the current market. There are 195 Melbourne homes scheduled for auction this week, up on the 168 over the previous week. This is coupled with the fact that the sizes of auctions will also be increasing this weekend, momentum is slowly creeping back into the property market across Melbourne.