Home owners and agents will find little to cheer about following another weak performance for the auction market yesterday. The Real Estate Institute of Victoria said the clearance rate was 59 per cent for the 569 results reported to the group. The outcome of another 87 scheduled sales is still unknown.
The market's performance has slipped slightly compared with the past four weeks, defying hopes the big interest rate cut early in the month would deliver improved conditions for vendors.
''While the clearance rate hovers around 60 per cent, it's clear that the market continues to be impacted by low levels of consumer confidence,'' REIV spokesman Robert Larocca said.
It's a measure of how cautious buyers have become that not even a combination of cheaper credit and price falls are enough to attract them back into the market in any great numbers.
New research from RP Data-Rismark shows dwelling values have declined sharply across all price brackets in Melbourne, potentially wiping tens of thousands of dollars off the purchase cost of houses and units.
''We're currently seeing Melbourne dwelling values back where they were in February 2010,'' RP Data research director Tim Lawless said. ''I can't see the Melbourne market turning around over the next few months, to say the least.''
Hardest hit has been the premium sector, with the top 20 per cent most expensive suburbs shedding 9.6 per cent of their value since the market peaked in early 2010.
The mid-range segment, representing about 60 per cent of the suburbs, has recorded a price fall of 8 per cent. The city's more affordable areas have weathered the slump best, although prices have still come off 5.5 per cent from their peak last year.
Put another way, the slump has theoretically shaved $48,000 off the price of a $600,000 home over the past two years.
With these ''savings'' on offer and the large amount of property listed for sale right now, it is clear why industry operators are calling this a ''buyer's market''.
Except buyers aren't taking the bait. The clearance rate, while an improvement on the end of last year, is lacklustre. Housing finance figures are weak. The number of sales is 20 per cent below the five-year average, according to RP Data.
''The reality is that housing still isn't cheap even though we've had these falls,'' said Louis Christopher, managing director of SQM Research. ''We may well be in a buyer's market - and we are - but the reality is it could become even more of a buyer's market. That's what buyers are holding off on, that's what some of them are counting on.''
Of course, not all buyers are choosing to wait and see. Despite rising fears about the health of the global economy and a deepening property slump, more than 800 properties are still changing hands in Melbourne every week through auctions or private sales.
Only time will tell whether these buyers have made their move at the optimum time. As the real estate adage says, no one rings a bell at the bottom (or top) of a market.