March market booming in the West – ‘subject to credit’.
Over the first three weekends of March more than 1,730 auctions were recorded by the Real Estate Institute of Victoria (REIV). 734 homes were sold at auction with 663 passed in, 353 of those by vendor bid. So far in March the clearance rate has averaged 55.5%, slightly down on February’s 56.5%.
With Autumn here the market has fired up with more sellers going to auction. The ‘first-home’ buyers brigade are still leading the charge, particularly in Melbourne’s more affordable outer suburbs. This is driving a boom in the west out Wyndam and Hoppers Crossing way. Wyndam house price growth grew by 10.7% across 2018. Truganina values rose by 15% in the 12 months leading up to November 2018. Williams Landing was up 13.8%. Melton house prices rose 14.1% (CoreLogic).
But another data analyst (Hotspotting Price Predictor), puts Melton’s 2018 growth higher at 20%. Immigration is also boosting the numbers of buyers in the region. An emerging trend in 2019 is more buyers making offers with a ‘subject to credit’ clause. With tightened lending conditions the banks are putting more scrutiny on valuation, are more conservative in estimates, and determined to screen out any overpriced property. And the banks are also looking much closer at the borrower’s job security and dependability of income.
These ‘subject to credit’ clauses and conditions feature less in blue chip areas where a buyer’s finances are usually more substantial. According to Nick Johnstone (Nick Johnstone Real Estate, Brighton) his company is not keen on conditional offers…”Our normal response is go get your finance sorted, then come and see us if the property is still available.”
But in Balwyn, Ray White Director Helen Yan says that in their falling market they have to accept ‘subject to credit’ clauses. “If you have no other buyer…you have to try anything.”
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