Hallow’s House at 184 Kooyong Rd, Toorak, achieved an impressive auction result on Saturday.

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Melbourne’s median house value has fallen for the fifth straight month, and is now $16,000 below where it was a year ago in a blow to homeowners across the city.

The latest PropTrack Home Price Index released today has revealed the drop, which has in part been caused by government taxes driving investors to sell and thinning buyer demand

The Index shows a 1.75 per cent decline for the typical house value to $914,000 in the Victorian capital since the same time in 2023, and includes an almost $2000 (0.2 per cent) drop in the past month.

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The city’s $609,000 typical unit value is essentially flat compared to a year ago, when it was $500 higher.

But there was some good news for homeowners yesterday with PropTrack recording preliminary 69.1 per cent auction clearance rate from 559 reported results out of the 1103 that were scheduled for this week.

PropTrack senior economist Eleanor Creagh said the falling home values were modest as declines go, but could have Melbourne owners looking enviously at other states where prices are surging.

“I would not characterise it as a bad year, but it’s certainly not as good a year as in Perth,” Ms Creagh said.

PropTrack senior economist Eleanor Creagh, Photo: Supplied

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There was variance in the market, though, with reductions in values more modest in Melbourne’s north east, down just 0.09 per cent in the past year, and being felt more in the city’s inner south where they were down 1.22 per cent in the same timeline.

While this has been great news for buyers, the economist noted it showed it was an early sign that “buyer demand isn’t meeting the stream of listings”.

She added that while the number of listings was on the rise, and the total number of homes for sale across Melbourne was at its highest level since 2018, a hefty 39 per cent of them were investors selling up – a figure that has increased over the past few months.

“And that’s higher in Melbourne than in any capital, except Darwin,” Ms Creagh said.

Melbourne’s median house value is now sitting at $914,000, PropTrack data shows. Picture: Manuela Cifra.

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Australian Bureau of Statistics data also shows that investor purchasing is growing weaker.

Ms Creagh said regional Victoria was slightly worse off than Melbourne, with its $595,000 median house price dropping about $11,000 (1.88 per cent) over the past year, while the typical unit was virtually flat at $419,000 with a marginal $250 (0.06 per cent) lift.

In both instances, the economist said there would be a floor under the market that would eventually stop falls as the state’s population continued to grow as new housing approval numbers declined.

“I wouldn’t expect this to be a protracted decline,” Ms Creagh said.

By Christmas, she added that there would be more clarity around interest rates which could spur buyer activity in the new year.

Hallow’s House in Toorak is built around a central courtyard.

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Prolific architect Guilford Bell, who designed Hallow’s House, was born in 1912 and died in 1992.

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And while some buyers might be waiting for a potential interest rate cut before they purchase, this Saturday still saw plenty of impressive results across Melbourne.

A heritage-listed Toorak house designed by famous architect Guilford Bell sold for a massive $1.2m above its $5.2m reserve.

Jellis Craig Boroondara’s Mike Beardsley said the circa-1975 three-bedroom home at 184 Kooyong Rd, named Hallow’s House, fetched $6.4m.

Two bidders competed for the keys to the three-bedroom, U-shaped home organised around a central courtyard, with an architect with a link to Bell emerging as the victor.

Behind its red brick facade, Hallow’s House features timber-lined ceilings, floor-to-ceiling windows and doors, skylights and a north-facing living area.

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“It has been really rewarding, the vendors are rapt the house has stayed in the hands of an architect who worked with Guilford Bell,” Mr Beardsley said.

Stonnington Council heritage documents state the Hallow’s House is significant due to its “functional, eccentric and theatrical” character and association with Bell, a leading post-war modernist architect who designed homes for some of Australia’s wealthiest families including the Myers, Baillieus and Packers.

The house at 21B Sixth Ave, Burwood, also sold this weekend. The triple-story residence has views over nearby Gardiners Reserve.

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In Melbourne’s inner east, a four-bedroom Burwood house sold for $2.105m after three bidders participated in the auction.

Ray White Ashburton’s Leigh Petropoulos said the 21B Sixth Ave home’s new owners were a couple with children.

“The auction started at $1.8m, it was very close between two bidders the whole way,” he said.

“As soon as it was called on the market, it was like popcorn, just going back and forth – they both really wanted it.”

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