Geelong auctions market is under the hammer this spring

Can home buyers and sellers expect a dramatic change as they navigate the property auction market in Geelong this spring? See the auction hot spots.

Marcus Falconer is set to auction 25 Roxby St, Manifold Heights on Saturday.

Homebuyers shouldn’t anticipate being spoiled for choice this spring, with a predicted surge in listings not expected to dramatically increase supply above demand.

Geelong’s real estate market remains in the grips of a tighter supply of quality properties and a lack of confidence in the face of higher interest rates.

While the city’s auction market is set for a bigger opening to the spring selling season than in 2022, a lack of confidence in going to auction continues to limit the amount of properties going under the hammer.

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Research from Ray White shows the auction market is performing considerably differently in Geelong than it was at the height of the pandemic boom, when there was on average more than five people competing for each property.

Today, that figure is closer to one bidder, but the research shows that properties selling at auction were achieving a 12 per cent premium compared to homes selling prior to auction in August.

PropTrack data reveals a lift in the number of properties scheduled for auction at the start of spring, but local agents warned it may not last, with tight supply anticipated through the traditionally strong selling season.

Auctioneer Ben Riddle says auctions were also a way of placing a sense of urgency on buyers.

Geelong’s median house price has declined almost 5 per cent over 12 months to $765,000, according to PropTrack.

Buxton, Newtown director Ben Riddle said auctions will still perform better where there’s a lack of supply of quality homes, but some segments of the market are stronger than others.

“It’s always going to reward markets or suburbs where there’s a lack of supply,” he said.

“We’ve certainly seen turnkey properties are more popular because confidence in trades, confidence in banks lending money to do work is a bit more chequered.”

This contemporary home at 1 Sargeant St, Geelong West, is among the properties going to auction on Saturday.

Mr Riddle said the lower auction volume pointed to a lack of confidence driven by vendors and agents to selling on the street.

“People tend to use auctions because if you’ve got multiple buyers, that’s the best way to sell,” he said.

“The truth is, auctions can also be used to create urgency for a sale where there’s a market that doesn’t want to be urgent.

“So I think unfortunately, both vendors and agents have gone away from the auction process not necessarily for the right reasons.

“Anything that sells well in the market normally is a bit rare,” he said.

3/13 Swanston St, Geelong, is scheduled for auction on Saturday.

More expensive homes are seeing the best auction results, with buyers looking to upgrade still active.

“All those buyers in the $1m-plus bracket are probably second or third-home buyers, so they tend to have a better equity position or better borrowing capacity,” Mr Riddle said.

Hodges, Geelong West director Marcus Falconer said more properties targeted to first-home buyers and investors would be listed for private sale this year due to the lack of intensity in those markets.

More first-home buyers are unable to buy unconditionally, a key plank of the auction market, while rising costs were turning investors away.

Geelong’s blue chip inner circle remained among the best prospects, Mr Falconer said.

The biggest suburbs for auctions over the next month include Belmont, Geelong, Geelong West and Highton, PropTrack listing data shows.

Marcus Falconer says the city’s inner ring of suburbs remained the strongest for auctions.

“The interest in those segments of the market for auctions is still strong. So family homes and homes in the inner circle, they’re still quite popular,” he said.

“I think it could be a slow start to spring. Stock is going to remain in short supply this spring and we’re going to find ourselves in a situation where demand will still be level-pegging or outstrip supply.”

Mr Falconer said buyers need to consider the future when bidding for properties.

“I don’t think Geelong is going to get any better value than what it is now,” he said.

“It’s quite clear the migration patterns and the demand from people that are coming to Geelong, whether returning where they’ve had previous interest in Geelong, or whether exploring Geelong as a new destination. That’s still going to continue to grow exponentially over the next 10 years.”

Mr Falconer said new buyers were tracing family connections to Geelong, whether following grandchildren in to the city.

Originally published as Geelong auctions market is under the hammer this spring