Higher rates dent house prices

House prices went backward across much of Melbourne in the first three months of this year, new Real Estate Institute of Victoria figures reveal.

The median price for a detached home in Melbourne in the March 2008 quarter was $432,500, down 8.4% on the December 2007 median of $472,250.

“Increasing interest rates, coupled with the changing economic conditions, have affected confidence, transaction numbers and clearance rates, all of which have combined to cool the market since the beginning of 2008,” REIV chief executive Enzo Raimondo says.

The Anzac long weekend saw a big drop-off in properties up for auction in Melbourne, with 68% of 358 properties selling compared to 65% of 561 properties sold the previous weekend.

In Sydney, 56% of 145 properties sold, according to Australian Property Monitors, up on 54% the weekend before, but again the number of properties for sale was well down – 145 compared to 270 the previous weekend.

There was no change in Brisbane’s clearance rate, which remained level on 36%, while in Adelaide clearance rates lifted from 53% to 58%.