MELBOURNE's property market set a record of more than $1 billion in total sales last week on the back of a searing-hot auction market.

Agents reported it was the biggest opening weekend for auctions in at least seven years, with the cooler weather no deterrent for crowds of more than 100 people at several auctions.Many would-be buyers were left further frustrated as 87 per cent of 967 homes were sold under the hammer. This time last year the clearance rate was 73 per cent for 587 auctions.The fierce competition will only make more properties less affordable in the inner and middle suburbs, where auctions are concentrated.
The Real Estate Institute of Victoria reported $701 million in auction sales and an additional $324 million in private sales.

The total surpassed even the spending spree before Christmas and the big weekends of the 2007 property boom.
Buyers advocate Mal James said the market for homes over $1 million was leading the surge, with nearly three bidders at every auction.''It is not easy for buyers out there,'' he said. ''There's more than one buyer for almost everything on sale.''There were nine bidders at the auction of a historic St Kilda West mansion that belonged to the RSL. The property sold for $4.1 million in front of a crowd of more than 150 people.Buyers were most frustrated in the inner south and east, with almost every apartment in suburbs such as South Melbourne and Albert Park sold at auction.Mark Armstrong of Property Planning Australia said it was investors who were driving demand for inner-suburban apartments in Melbourne.Mr Armstrong said he expected investor activity would propel price growth until mid next year.But such activity would be subject to interest rate rises, he said.Alistair Craig of Jellis Craig said the last Saturday of every month was usually busy, especially before a long weekend, but this weekend had been exceptional.''It's a very strong market out there, with lots of demand and a shortage of properties,'' he said.The auction market will wind down again for next Monday's Labour Day holiday, but there are about 730 auctions expected the following weekend.