This week across the combined capital cities, auction volumes remained high with 3,353 homes taken to auction returning a preliminary clearance rate of 63.1 per cent, increasing from last week when the final clearance rate across the capitals recorded the lowest not only this year, but the lowest reading since late 2015/ early 2016 (60.3 per cent).
The lower weighted clearance rates of late can be attributed to the continual softening conditions across the two largest markets of Melbourne and Sydney, with clearance rates tracking below 70 per cent across Melbourne for 5 consecutive week’s now (67.4 per cent), however volumes across the city have been consistently higher; with volumes this week reaching their second highest level this year (1,837), while Sydney’s clearance rates have tracked around the mid-high 50 per cent range over 7 consecutive week’s (58.7 per cent). Across the smaller markets, Canberra recorded the highest preliminary clearance rate this week, with 66.7 per cent of homes selling, while Brisbane returned the lowest with only 46.6 per cent of auctions successful.
The preliminary auction results are in from Domain. We see an ongoing weakening trend, especially in Sydney where last week clearances settled at 51.4%, and the preliminary today is 58.2% so far, but will settle lower.
Comparing the results with last year, both the volume of sales and auctions are down. This will continue to lead home prices lower.
Brisbane achieved 44% of 117 scheduled, Adelaide 67% of 108 and Canberra 68% of 80.
There were 3,276 auctions held across the combined capital cities this week, returning a preliminary auction clearance rate of 63.5 per cent, increasing on last week’s final auction clearance rate of 61.1 per cent when the combined capitals recorded the third busiest week for auctions so far this year (3,438). Over the same week last year, auction volumes were similar to this week (3,207), although the clearance rate was considerably higher at 72.3 per cent.
Across the two largest auction markets, Melbourne and Sydney, both cities saw an increase in the rate of clearance over the week, however the 66.0 per cent preliminary clearance rate across Melbourne is only slightly higher than last week’s final; this is likely to revise lower as final results are collected and potentially surpass last week as the lowest seen since June 2016. While the performance across the smaller markets was varied this week, with Canberra recording the highest preliminary clearance rate of 75.6 per cent, while only 44.9 per cent of homes sold across Brisbane.
The latest results from Domain show that the volume of auctions this week was lower, and last week the clearance rate ended up at a weak 58.7% nationally. More evidence that momentum is easing, especially in Sydney.
Brisbane cleared 45% of 131 scheduled, Adelaide 58% of 87 and Canberra 77% of 81 auctions scheduled, so the strongest result.
The current state of the property market in Sydney is still unclear following on from another weekend of auction results,” John Cunningham, president of the REINSW, told SCHWARTZWILLIAMS.
Cunningham said that 40 per cent of results have not been reported, and if those results represent a no sale, then the clearance rate for Sydney could be a lot lower than the 66.2 per cent being reported by CoreLogic.
“With an initial clearance rate again in the mid 60 per cent range, the lack of clear data from the 40 per cent of unreported results fails to provide us with the real picture of the market,” he said.
“How many were withdrawn, how many were passed in, how many had no bids, needs to be known to get a clear picture,” said Cunningham.
“If we consider the worst case scenario that this missing 40 per cent did not sell, then the true clearance rate is 65 per cent of 60 per cent being 40 per cent,” said Cunningham.
“The reality from the word in the street is more like over 50 per cent of properties listed for auction at present are either selling at or before auction,” clarified Cunningham.
With so much uncertainty about auction clearance rates, Cunningham said the days on market “becomes the true test of what is really happening”. In the past year, days on market has risen from 33 days to 49 days, he said.
“It is sometimes taking longer to get vendors and buyers aligned on price,” said Cunningham.
Agent Nigel Mukhi from McGrath Lower North Shore Neutral Bay told SCHWARTZWILLIAMS he agrees with Cunningham’s assessment.
Though Mukhi said that the trend doesn’t apply to his office, when his competitors withdraw a property from auction or if they don’t sell, they don’t report the result.
Mukhi said that his office is achieving a clearance rate of 82 per cent, and that Sydney has to be analysed area by area.
Higher volumes weighing on Melbourne’s clearance rate
REIV President Richard Simpson told SCHWARTZWILLIAMS that the latest REIV data shows that 1,305 homes went to auction last weekend, recording a preliminary clearance rate of 69 per cent.
“Victoria’s weekly clearance rate has dipped below 70 per cent for the first time since June last year, as high auction volumes start to meet buyer demand.”
High auction volumes are set to continue, said Simpson, with around 1,300 auctions scheduled this coming weekend and a further 1,450 the following week.
“The city’s strong auction market is set to continue well into December with more than 3,600 auctions scheduled throughout the month,” said Simpson.
Regional areas experiencing strong clearance rates, said Simpson, especially Greater Geelong which achieved a clearance rate of 82 per cent.
Soft Northern Territory clearance rate
The Northern Territory recorded soft auction clearance rates last week, according to Karl Secondis of One Real Estate.
“Overall our market had a soft clearance rate of just 27 per cent,” he wrote in his report ‘The Auctioneer’.
“A large number of new listings have just hit the market this week which has strengthened auctions numbers in the final weeks leading into Christmas with a bumper week of over 30 auctions set to take place in week 49,” he wrote.
Five properties will go to auction in Gove on Wednesday night
There were 3,409 homes taken to auction across the combined capital cities this week, returning a preliminary auction clearance rate of 66.9 per cent, overtaking last week as the third busiest week for auctions so far this year. Last week, based on final results, 60.9 per cent of the 3,390 auctions held recorded a successful result, the lowest clearance rate since late 2015/early 2016.
Once final results are collected, the combined capital city clearance rate tends to revise down so at this stage it’s looking like the final clearance rate on Thursday will be in the mid to low 60 per cent range for the sixth week in a row. Sydney and Melbourne, the two largest auction markets, have seen clearance rates increase week-on-week after last week saw both cities recording their lowest clearance rates for the year so far, however as usual, these clearance rates will revise lower over the week. Over the same week last year, a total of 3,398 homes were taken to auction across the combined capital cities, and a clearance rate of 73.0 per cent was recorded.
The preliminary results are in from Domain. Melbourne continues to run ahead of Sydney, with rates in the mid 60’s, significantly below this time last year. Typically the final results are lower. More evidence of a cooling market, so expect prices to move lower.
Further confirmation today that Sydney is leading the property market lower, based on the preliminary auction results from CoreLogic.
The combined capital cities returned a preliminary auction clearance rate of 65.4 per cent this week across 3,335 auctions making it the third busiest week for auctions so far this year, increasing from 62.8 per cent across 2,907 auctions last week. This time last year, 2,987 homes were taken to auction and a clearance rate of 74.4 per cent was recorded.
The final clearance rate has remained below 65 per cent for the last 4 weeks and it’s likely that this will be the case again on Thursday when the final results are released. One of the biggest contributors to the softer auction market conditions is Sydney, where the final clearance rate has remained below 60 per cent since the last week of October, while Melbourne has slipped below 70 per cent for the second week in a row.
The preliminary auction results from Domain are in. The trend looks like it is continuing to ease compared with last year, though a little up from last week so far. Melbourne is sitting on 72.1% stronger than last weekend.
This week, there were 2,894 auctions held across the combined capital cities returning a preliminary auction clearance rate of 66.5 per cent, increasing on last week when the final auction clearance rate fell to its lowest reading since early 2016, when 61.5 per cent of the 2,045 auctions cleared. Clearance rates have continued to track below 70 per cent since June the year; this is a considerably softer trend than what was seen over the same period last year when clearance rates were tracking around the mid 70 per cent range for most of the second half 2016. Results across each of the individual markets were varied this week, with Canberra recording the highest preliminary auction clearance rate of 72.9 per cent, while in Brisbane only 45.7 per cent of auctions cleared.