The spring selling season has kicked off strongly to solidify signs of a Melbourne market recovery.

September has so far returned auction clearance rates above 74 per cent each week, and seen properties soar hundreds of thousands of dollars — and sometimes more than $1 million — past their reserves.

Sellers are back in the box seat, although many homeowners remain reluctant to list as a result of a market correction that has wiped 9.5 per cent from Melbourne home values since they peaked in November 2017.

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Nelson Alexander auctioneer Tom Alexiadis in action during Melbourne’s hot spring selling season. Picture Jay Town

This is only fuelling the market resurgence by giving buyers little to choose from.

Experts say the downturn is done, and three straight months of dwelling value rises reported by CoreLogic support that.

Advantage Property Consulting director Frank Valentic said May’s federal election result changed the state of play.

“There were a lot of people holding off before it. And if Labor got in, we’d still be in a buyer’s market and a down market,” he said, noting the potential impact of proposed negative gearing and capital gains tax changes.

A string of important changes followed — the Reserve Bank cut the cash rate to a record low 1 per cent, and the Australian Prudential Regulation Authority removed interest-only lending caps and a 7 per cent serviceability buffer on loans.

“All of that has changed Melbourne from a buyer’s market to a seller’s market,” Mr Valentic said.

23 Huntingtower Rd, Armadale smashed its reserve by $1.45 million to fetch $4.35 million.

Realestate.com.au chief economist Nerida Conisbee said the end of the banking royal commission was also key to the market’s resurgence, while a supply-demand imbalance had pushed it further along.

“Buyers are back, but at the same time we haven’t seen an increase in listings,” she said.

“That’s putting pressure on prices in some locations.”

Real Estate Institute of Victoria president Robyn Waters said the “strong start to spring” had been driven by “buyers who are very keen to get into the market” coupled with “vendors who have been reluctant since the correction”.

“We expect the market to stay strong,” she said.

REIV figures show Melbourne hosted fewer auctions in the September quarter (6074) than the June quarter (6400), but notched more sales (4623 vs. 4078).

The institute expects just 7000 homes to go under the hammer in Victoria throughout spring, which would be well down on last year’s 11,036 auctions and the year before’s 13,844.

CoreLogic auctions analyst Kevin Brogan said weekly volumes were creeping up as spring progressed, with last week’s 1020 auctions the third highest offering of the year.

The resulting 75.6 per cent clearance rate was deemed a strong result for the market.

705/147 Beach St, Port Melbourne beat its reserve by $1.54 million to sell for $4.34 million.

Mr Brogan said while Melbourne’s auction sale rate had languished “just above 50 per cent at best” every weekend this year up to the federal election, it had now remained above 70 per cent since July.

“It’s been a solid and stable recovery that’s been to the benefit of vendors,” he said.

Notable September auction sellers were a Port Melbourne apartment at 705/147 Beach St that smashed its reserve by $1.54 million to fetch $4.34 million, and an Armadale house at 23 Huntingtower Rd that skyrocketed $1.45 million past reserve to $4.35 million.

-with Jayitri Smiles

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