Great Ocean Report Spring 2025

WELCOME to our Spring report. As we enter our coastal “selling season”, it is a good time to understand what is happening in the market, whether you are a potential buyer or seller or property owner.

For the context of this report, we wanted to give you a helicopter view of what’s happening. If we think about the highs and lows of the market, we saw the high of the market in terms of price during COVID and as we look back with hindsight, it’s becoming increasingly clear that the low of the market will likely be seen at around the time of the federal election, between the first two interest rate cuts.

The most visible sign and most widely reported sign of market sentiment is the auction clearance rates in Melbourne, and they’ve been at buoyant levels for quite a while. Again, to provide context, they’ve been consistently running in the mid 70 per cent range since May, whereas 12 months ago, they were around a 60 per cent clearance rate. The volume of auctions has also been good, with numbers often above 1,000 each week, and that’s a very solid result for the Melbourne market.

Over the last 12 months, we’ve seen a rise in Melbourne median house prices of about 1.8 per cent. So while not a huge rise, in the context of cost of living pressures, it’s a solid performance. There is also a lack of supply of quality properties available for sale in Melbourne, with listing numbers actually down on historical data.

The Melbourne metropolitan market is made up of lots of different price points and not all of them are active in a recovering market. Typically, it’s the lower end price points that are most active first and this is for several reasons. Firstly, from an affordability perspective, there are just more people around with less money. The higher the price, the number of people who can afford it diminishes. Secondly, larger financial decisions (to buy higher priced properties) require more confidence and that comes from evidence. That is why property markets tend to improve from the bottom up.

Confidence is contagious so you’ll see that start to work its way up into the upper price points as the market becomes more active. Typically, this improvement is seen in the metropolitan market first and then flows onto the coastal markets in Spring, and that’s exactly what we’re seeing now, and true to script, it’s mostly in the lower end at the moment.

The numbers of people who are attending our open for inspections have risen significantly and this is mostly in that lower end price range at present. Many people feel comfortable “to start their search” now that they have seen market activity increasing as interest rates have reduced and most of them are from Melbourne.

In terms of expected price rises, it is just too early to say, but we do expect engagement levels (the amount of people active in the property market) to continue to increase as the herd sees others doing the same. Prices are governed by economic forces generally, but we don’t expect to see a COVID era type acceleration in prices.

We hope you found this Spring Great Ocean Report informative.

If we can be of any assistance in any real estate matter, please feel free to reach out; we’d love to hear from you.

Marty Maher 0419 505 279

Michelle McDonald 0418 123 927

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