Victorians spent more than $950 million on real estate last week alone, with a strong auction day yesterday capping off the biggest spending spree on record.  

Blatant under quoting and grave concerns over housing affordability did little to tarnish Victoria's biggest home sale bonanza.

Agencies hosted 887 reported auctions yesterday - more than any single day since November last year.

Almost nine out 10 homes sold during the week, as did 713 homes in private sales, resulting in a sales total of $951,650,000 since Monday.

"We are finalising (yesterday's) results, but on what we have in front of us it appears this was the strongest day in dollar terms in our recorded history," Real Estate Institute of Victoria spokesman Robert Larocca said.

Homes repeatedly sold for up to 20 per cent above quoted prices yesterday.

Industry stalwart Tim Fletcher "stuck his neck out" and forecast Melbourne's median house price would reach almost $650,000 by the end of next month.

"This quarter is going to be the biggest quarter ever," Mr Fletcher said.

A former housing commission home in Jackson St, Richmond, which was last bought for $4400 in 1958, was advertised for $700,000 to $750,000 despite the fact its actual asking price was $800,000.

Agent Bruce Severns said he did not know what price the vendor was seeking until auction day.

The unrenovated home sold in front of a crowd of almost 100 to a young couple for $917,500.

Commentators warned home affordability was slipping away from many first-time Buyer advocates said they were deeply concerned by the level of demand.

"The seriousness of the affordability crisis is much more dire than anyone has so far been prepared to say," advocate Catherine Cashmore warned.

"This is not a bubble, but representative of something much more enduring, a crisis."

Source; Sunday Herald Sun
Date: Sunday, February 28, 2010
Author: Caroline James