The opening weekend of the bumper spring market passed its first test with flying colours, with 70 per cent of the 1250 properties up for auction in Sydney and Melbourne selling.
Sydney posted an 84 per cent rate from 418 results reported to Australian Property Monitors (owned by Fairfax Media), while Melbourne scored a solid 76 per cent from 832 auctions, according to the Real Estate Institute of Victoria data.
Sydney's auction clearance rates have been running above the 80 per cent mark for the past 10 weeks, and Melbourne's rates have hovered at 70 per cent and above all year.
RP Data spokesman Robert Larocca said Melbourne "wasn't seeing the boomtime-type clearance rates of Sydney, but nor were they the anaemic ones of a couple of years ago.
"We are really seeing the effects of the last interest rate cut. This is a sustainable market, but we won't be seeing rampant price growth."
Castran Gilbert director Paul Castran said economic indicators suggested there could be another one or two interest rate cuts from the Reserve Bank of Australia before Christmas.
'We are at the beginning of the next cycle. People are more confident and confidence is infectious. If you were a genius, you would have bought between May and September last year," he said.
But Melbourne's clearance rate could yet fall a few points after 105 missing results are chased up midweek. Of the 201 properties that passed in, nearly half (101) did so on a vendor bid.
While strong clearance rates were reported in Camberwell, Glen Waverley and Preston, there were some very patchy results elsewhere.
Just five out of 10 properties sold in Brighton; a quarter of properties in the solid eastern suburban family areas of Surrey Hills and Templestowe; and only one of the three auctions in blue-chip East Melbourne was successful.
Caine Real Estate director Paul Caine sold a terrace at 114 Hotham Street, East Melbourne, for $3.81 million, $210,000 higher than its $3.6 million reserve, after bidding from two parties.
Buyer's advocate David Morrell, who was acting for a client at the auction, said the property would have fetched more than $4 million in earlier healthier markets.
Mr Morrell warned this was no boom market, with prices still well below their peak.
"Results are still very specific," he said. "If it's a good property it will sell, but if it's got any problems it won't."
Pollster Gary Morgan received only one public bid of $4.5 million for his palatial property at 193 George Street, East Melbourne, which at 1000 square metres is the biggest block in the neighbourhood. But it is overlooked by the Hilton Hotel and is decorated in a traditional style no longer in vogue with a new, cashed-up generation in the market for large family homes.
Abercromby's director Tim Derham said a later offer of $6.13 million had been received and negotiations were continuing.
Mr Morgan had put the house on the market in March, calling for expressions of interest through Abercromby's after buying 120 Powlett Street for $5.15 million.
Technology millionaires Evan Thornley and Tracey Ellery sold their renovated house across the road at 188 George Street last week for a sum believed to be just below $9 million, through Kay & Burton.
SO 14 Dundas Pl B 6rm undisc Gary Peer & Associates
SO 5 Brunning St WB 4rm 200sqm $805, 500 Biggin & Scott
SO 35 Fitzgibbon Cr B 8rm 582sqm undisc Gary Peer & Associates
SO 4/26 Emma St BV 5rm $707,000 Gary Peer & Associates
SO 5 Scott St WB 4rm 650sqm undisc Gary Peer & Associates
SO 17 Hopetoun St B 6rm $2,308,000 Biggin & Scott
SO 22 Garfield Av 6rm $1,170,000 hockingstuart
SO 27 Armytage Dr B 5rm $955,000 R T Edgar
ST KILDA EAST
SO 8/333 Orrong Rd B 4rm stratum $563,000 Gary Peer & Associates
PI 16/20 Cardigan St B 3rm strata $400,000 VB lo $400,000 res $449,000 Gary Peer & Associates