Anthony Albanese budget moves have cut bidders around Melbourne, but auctioneer Luke Banitsiotis is seeing signs that two bidders are delivering a “strong rhythm”.
Melbourne’s typical auction is getting one less bidder than a year ago, with some of the lowest number of bidders active at auctions on record.
It comes as the city recorded a preliminary 61.8 per cent clearance rate for the second week of the spring selling season, a modest shift from the same time a week ago, though scheduled numbers increased slightly to beyond 700 after starting spring at just 630.
Ray White analysis of their auctions, hundreds over the past month, has revealed an average of two people bidding for each home going under the hammer.
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A year ago it was more than three.
But even in 2024, when interest rates were at current levels, it was around 2.4 typical bidders for each auction.
This year’s stark low comes despite auction numbers plunging to their lowest levels since the pandemic, with this week slated for just above 700 — a weak figure by recent spring standards, and well below the almost 1200 a year ago.
Ray chief economist Nerida Conisbee said the drop off would have been heavily influenced by investors stepping back in the aftermath of the federal budget’s changes to investor tax benefits around capital gains and negative gearing in May this year.
Ray White chief economist Nerida Conisbee believes declining bidder numbers would reflect falling investor appetites after the May federal budget.
She added that it also reflected low attendance at open for inspections.
“The whole market seems a little bit stuck at the moment, and that’s affecting buyers and sellers,” Ms Conisbee said.
Despite this, a handful of Melbourne suburbs are defying the poor market conditions, with separate Ray White stats showing their auctions in Bundoora, Mill Park, South Morang and Glen Waverley have all averaged three or more bidders in the past four weeks.
But the number of sellers cashing in on the method has fallen in these areas, with the results reflecting just six auctions in Bundoora where there has been an average 3.8 bidders at each auction.
“Mill Park and Bundoora are a bit surprising … but I think it’s reflective of the lack of stock,” Ms Conisbee said.
The economist added that it could also be a sign vendors in those suburbs were being more realistic with their advertised prices ahead of auctions.
38 Brewster St, Essendon, was this week’s priciest auction result, sold for $4.3m.
Real Estate Institute of Victoria chief executive Toby Balazs said the numbers probably linked to Melbourne’s low clearance rate, and that it was important to note the areas recording success were also recording reduced auction activity.
“It will probably be a function of their being fewer auctions,” Mr Balazs said.
“The health of the auction market is currently challenged, but post-October 1 it’s going to be even more difficult as we wait for clarity on the new auction rules.”
He added that while it was likely to be revised in the coming days, a more than 60 per cent preliminary clearance rate could be an early signal of a spring market bounce — but the coming weeks would clarify the situation.
Ray White Victoria’s chief auctioneer Luke Banitsiotis said with an average 2.7 bidders registered and two active across their auctions around Melbourne, there had been a “strong rhythm” for the past seven days.
23 Kilcunda Drive, Rowville, tested out upcoming auction law changes and sold for $11,000 above expectations at auction.
“Successful sellers took the time to sit with the real time values presented by the room and chose to meet the market where it stands,” Mr Banitsiotis said.
“By making informed decisions based on current feedback, these homeowners achieved their core goal of getting sold and successfully unlocked their next chapter.”
He added that when sellers got their pricing right, buyers were out there and “ready to compete”.
But there was a positive sign for an upcoming auction law change in Victoria that will force homesellers to disclose their reserve price seven days ahead of the sale date.
A home at 23 Kilcunda Drive, Rowville, that trialled the requirement a few weeks ahead of it being enforceable sold for $1.336m, after having its reserve price published at $1.325m.
Ray White Ferntree Gully’s Jack Rickard handled the sale, while Fabian Sanelli called the auction.
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