Properties in Hawthorn, Kew, and Balwyn are positioned within the 35–40% of high-demand house markets with strong school catchments that achieve above-asking results (Bamboo Routes). However, RBA rate hikes in February and March 2026 have dampened buyer urgency and introduced new caution (Domain).
Buyer behavior is shifting as recent RBA rate hikes in February and March 2026 introduce caution (Domain). While high-demand pockets in the east remain resilient, the broader Melbourne house market is experiencing short-term volatility (NAB/Cotality).
Performance of high-demand house markets
Dwellings in areas with strong school catchments and excellent transport links are among the 35–40% of properties achieving above-asking results (Bamboo Routes). This contrasts with the wider Melbourne market, where 60–65% of properties sell at or below asking price (Bamboo Routes).
The impact of interest rate hikes
RBA rate hikes in February and March 2026 have dampened buyer urgency (Domain). We are seeing a shift in open for inspection behavior, where buyers are more cautious and less likely to commit to aggressive bidding compared to late 2025.
Auction versus private treaty outcomes
Private treaty sales in Melbourne typically close approximately 3% below the initial asking price (Bamboo Routes). In desirable suburbs, well-run auctions remain the most effective method to achieve results at or slightly above the quoted range (Bamboo Routes).
The house underperformance gap
There is a disconnect between high-end demand and general house performance. While properties priced above $1 million are selling well and above expectations, the general house market is currently underperforming relative to lower-priced growth sectors (NAB/Cotality).
Frequently asked questions
Are house prices still rising in Melbourne’s east?
The market is currently two-speed. While outer suburbs are outperforming the city median, the broader house market is seeing short-term volatility (NAB/Cotality). However, high-demand house markets with strong school catchments remain resilient, with 35–40% of properties achieving results above the asking price (Bamboo Routes).
Should I sell my property via auction or private treaty?
Private treaty sales typically close about 3% below the initial asking price (Bamboo Routes). For properties in desirable eastern suburbs, well-run auctions are more likely to achieve results that meet or slightly exceed the quoted price range (Bamboo Routes).
How are the 2026 RBA rate hikes affecting buyers?
Rate hikes in February and March 2026 have introduced a new level of caution (Domain). This has resulted in dampened buyer urgency, meaning properties that are not precisely priced may see longer campaigns or lower offer levels than in late 2025.
Is now a good time for investors to sell?
Properties priced above $1 million are selling well and often exceed expectations. However, the market is adjusting for entry-level properties below $1 million. Additionally, some investors are disposing of rental assets due to increased land tax and interest rates.
Questions to ask your agent
- How does my property’s proximity to specific school catchments impact the likelihood of achieving an above-asking result?
- What is the current gap between private treaty closing prices and initial quotes in this specific street?
- How has buyer urgency changed at open for inspections since the March RBA rate hike?
This article contains general market information based on data current as at April 2026. It does not constitute financial, legal, or real estate advice specific to your property or circumstances. For an appraisal and tailored advice, speak with a Fletchers agent in your area.