Analysis of the REIV June quarterly median prices shows that the Melbourne property market is strongest in the inner and middle suburbs.
The REIV classifies the inner city as those suburbs within 10km of the CBD and the middle those between 10km and 20km from the CBD.
Comparing the number of sales in the inner, middle and outer suburbs between the March and June quarters shows that the largest increase in homes sold was in the inner suburbs. In the June quarter there were 5,374 homes sold, a 21 per cent increase on the 4,456 sold in the March quarter.
The middle suburbs recorded a more moderate increase in sales with an increase of 11 per cent from 4,481 to 4,989.
A clear sign of the impact of interest rates, broader economic uncertainty, increases in the price of petrol and groceries can be seen in the fact that the number of sales dropped in the outer suburbs, by 9 per cent between the March and June quarters from 3,617 to 3,288.
Over the June quarter there was a subtle change in sales method being used to take property to market. The number of properties sold at auction during the June quarter increased by 17 per cent from the March quarter whilst the number of properties sold via private sale has increased 4 per cent, however this likely to be a statistical anomaly as there are almost no auctions conducted in the metropolitan areas during January. However if the comparison is made with the June quarter of 2007 it shows that the number of homes sold by private sales and auctions dropped by an equal amount of 22 per cent.
This shows that whilst the more moderate market conditions have not changed the method of sale, there has clearly been a substantial dampening of demand in the outer suburb and consolidation of demand for homes in the inner and middle suburbs.
