Property recovery continues: Sydney reaches 10-year highs and The Block apartments sell under the hammer

As contestants on The Block waited nervously to find out how much their newly renovated apartments would sell for, so did more than 800 other Australians in Sydney and Melbourne this weekend.

Auction clearance rates in Sydney were above 80% for the third week in a row this weekend, as Melbourne remains around 10% behind.

According to Australian Property Monitors, 80.8% of those properties listed in Sydney sold, while Melbourne homes recorded a clearance rate of 71% this weekend, according to the Real Estate Institute of Victoria.

APM senior economist Andrew Wilson told SmartCompany the Sydney market is tracking at the highest rate for a decade.

“It’s a very strong market, although the top end is still very flat. The APM house price report released last week showed the Sydney median house price was up by 2.7% for the June quarter, and this was in line with the other indicators,” he says.

The APM figures reflect the results for Saturday’s sales and could be adjusted later in the week, but the market clearance rate is still around 20% higher than last year.

“In Sydney, entry levels to the prestige market can be as high as $3 million to $5 million and it’s not unusual to get to homes selling for around $10 million. In Melbourne the market tends to be more accessible.”

“The Sydney market can reflect new money buyers and the stock market is also a good indicator of that,” he says.

Wilson says in Melbourne the spread of buyers is more even, as the prestige market doesn’t have “stratospheric levels of price entry”, in contrast to Sydney.

“The Melbourne market is still playing catch-up in terms of prices and market activity compared to three years ago, although what we have seen is a lift in auction numbers,” he says.

The number of properties being listed for sale is consistently around 10% or higher than this time last year.

On the weekend, the Real Estate Industry of Victoria recorded 506 properties for sale, while this weekend last year there were only 362.

The most expensive property in Melbourne over the weekend, a four bedroom house on Canterbury Rd in Middle Park, sold for $3.055 million.

Also in Melbourne, The Block Sky High concluded its season with all the luxury apartments selling.

The most expensive of the apartments in South Melbourne sold for $1.605 million.

REIV data showed South Melbourne’s median unit price was up $14,000 to $525,000 in the last quarter.

Wilson says, looking forward, the bumper year will continue, with Melbourne likely to receive a boost to its clearance rate in spring.

“It will increase over spring as it typically does, but a lot will depend on how the local economy performs. The unemployment rate is about 5.4% in Melbourne, but we’re still not sure where the economy is heading.

“If the unemployment reaches that 6% mark like it’s predicted to, then this will impact upon the market, but at the moment it’s showing incremental growth and it’s not pausing,” he says.