Month: May 2017

Retail funds harvest 50% of all superannuation fees

From The New Daily.

Retail super funds are soaking up half of all fees in the superannuation system despite holding only 29 per cent of retirement savings, according to new research carried out by Rainmaker for Industry Super Australia.

‘Retail’ includes the big four banks, who last year alone scooped up 28 per cent of all fees, totalling $8.7 billion.

Overall, the survey found that in 2016 Australians paid $31 billion in fees on $2.2 trillion of superannuation. That amount of fees is about the same as the cost to the government of superannuation tax concessions, and more than half the $45 billion spent on income support for the elderly.

Of that $31 billion in fees, the for-profit sector (which also includes self-managed super funds) ends up with $28 billion, or 91 per cent, Rainmaker found.

That’s because while the not-for-profit sector (including industry, public sector and corporate funds) charged a total of $12.7 billion in fees, $9.9 billion of that went to private sector wealth managers to provide insurance and fund management services. The not-for-profit sector kept only $2.8 billion.

A further breakdown of super costs shows how retail funds harvest more:

  • Retail super funds, with 29 per cent of funds under management (FUM) and an estimated 45 per cent of members, received 50 per cent ($15 billion) of all fees
  • Not-for-profit funds (industry, public sector and corporate) accounted for 42 per cent of FUM, 45 per cent of members and collected 42 per cent (roughly $13 billion) of fees
  • SMSFs with 30 per cent of FUM and 10 per cent of members received 7 per cent of all fees

Within the for-profit sector there is further inequality. Rainmaker estimates that Australia’s five major banking groups and AMP receive 40 per cent of total super fees, or $12.3 billion, while the big four banks alone account for $8.7 billion in fees.

David Whiteley, CEO of Industry Super Australia, told The New Daily that “the banks have been getting significant funds from superannuation yet they have been underperforming the not-for-profit funds”.

“The government should be evaluating whether they think its appropriate for the banks to be generating nearly $9 billion a year from fees on super.

“The government and regulator need to find out if the bank-owned super funds are eroding workers’ super savings by generating profits for the parent bank.”

Alex Dunnin, research director at Rainmaker, said there had been some pressure on for-profit funds to reduce costs in recent years but they still have high costs. “There’s nothing necessarily wrong with being in high-fee products but you need to make sure it’s worth it.”

Source: Rainmaker

As the above chart shows, retail funds have significantly underperformed not-for-profit funds over the last 10 years.

“The bank-owned super funds delivered returns of 2 per cent less per annum when compared to industry super funds over 10 years. For an average income earner, this under-performance, if continued, could cost $200,000 in retirement savings over their lifetime,” Mr Whiteley said in a statement.

Mr Dunnin said the research showed retail fund members spend about $5.4 billion on advisors because much of their business is advisor driven. Advisory fees include entry advice fees, grandfathered ongoing trail commissions for pre 2013 business and fee for service portfolio structure and investment advice fees.

Industry funds do provide some advice but its total is very small and not captured by the research, he said.

Total fees paid by superannuation fund members across Australia decreased marginally during 2015-16 from 1.19 per cent to 1.18 per cent.

The Financial Services Council declined a request for comment.

*The New Daily is owned by a group of industry super funds

We Paid $31 billion in Super Fund Fees Last Year

From Business Insider.

Australians paid $31 billion as fees to fund managers to handle their superannuation funds last year, according to a study by Rainmaker.

These numbers put it in perspective.

  • There were 28 million pension or superannuation accounts in the country, according to the The Association of Superannuation Funds of Australia Limited
  • A total of 12.06 million Australians were employed as of March out a population of 24.5 million, according to government statistics
  • Australian retirement assets totaled $2.3 trillion, the fourth largest such savings pool in the world

This works out to a fee of $1,107 per pension account a year, or $2,570 for every employed Australian. That compares with the average weekly total earnings of $1,164.60.

The following chart from Rainmaker shows the distribution of fees.

Rainmaker/ Supplied

The survey also underscores that the Australian savings pool isn’t gaining from the economies of scale as one would expect.

While total retirement assets soared 11% in the year to March 31, total fees paid by members across Australia stood at 1.18% last year from 1.19%, the previous year.

As the following table points out, the drop in fees has slowed to a trickle. From 1.33% in 2010, it fell to 1.19% three years earlier thanks to reforms by the government to institute a low-fee passive investing product. Since then the numbers have stagnated while assets have soared.

Rainmaker/ Supplied

Fees are coming down predominantly because of falls in administration fees, which are often paid out when an account is set up, rather than falls in investment fees, Rainmaker said.

The nation’s retirement assets are projected to reach $7.6 trillion by 2033, according to Deloitte.

The estimate is based on the guaranteed pension contribution climbing to 12% from 9.5% now and investment growth, Deloitte says.

Australia introduced a compulsory retirement savings plan in 1992 to address the burden an ageing population would exert on the pension system and public finances.

While that has boosted assets, the focus is shifting to fees in a low yield environment. There are nine different type of fees the funds charge including exit and activity-based fees, according to the Australian Securities & Investments Commission.

A 1% difference in fees now could be up to a 20% difference in 30 years, the regulator says in its website.

Retirement Income Stream Review Outcomes

In its superannuation policy for the 2013 election, the Government stated that it would review both the minimum withdrawal amounts for account-based pensions and the regulatory barriers currently restricting ‘the availability of relevant and appropriate income stream products in the Australian market’. The Treasury has now released the outcomes of the review.

The paper says the current annual minimum drawdown requirements are consistent with the objective of the superannuation system to provide income in retirement and should be maintained.

An additional set of income stream rules should be developed which would allow lifetime products to qualify for the earnings tax exemption provided they meet a declining capital access schedule.

In regard to the existing minimum drawdown rules:

1. The current annual minimum drawdown requirements are consistent with the objective of the superannuation system to provide income in retirement and should be maintained.
2. The Australian Government Actuary should be asked to undertake a review of the annual minimum drawdown rates every five years and advise the Government to ensure that they remain appropriate in light of any increases in life expectancy.
3. Any other changes to the minimum drawdown amounts should only be considered in the event of significant economic shocks and based on further advice from the Australian Government Actuary.

In regard to the development of other annuity-style retirement income stream products:

4. An additional set of income stream rules should be developed which would allow lifetime products to qualify for the earnings tax exemption provided they meet a declining capital access schedule.
5. The alternative product rules should be designed to accommodate purchase via multiple premiums but additions to existing income stream products should continue to be prohibited.
6. Self-Managed Superannuation Funds (SMSFs) and small Australian Prudential Regulation Authority (APRA) funds should not be eligible to offer products in the new category.
7. A coordinated process should be implemented to streamline administrative dealings with multiple government agencies.

Minimum drawdowns in practice

Chart 1 (below) illustrates a drawdown scenario for male and female retirees commencing an account-based pension with a balance of $200,000 at age 60 and drawing down at the minimum payment amounts with investment returns of 6 per cent per annum. The chart shows the account balance at various ages and the income drawn down each year in both nominal and net present value (NPV) terms.

An account-based pension drawn down only at the minimum rates can be expected to last beyond average life expectancy, although the NPV of the annual income will generally gradually diminish. In the below example, the net present value of the account balance at life expectancy is around 25 per cent of the initial opening account balance. The net present value of income from the pension declines steadily over time, but ‘ratcheting-up’ occurs when the regulated percentages increase, resulting in a somewhat variable income stream in nominal terms.

Chart 1

Note: The analysis assumes an average nominal investment return of 6 per cent. This is also the discount rate for net present value.

Proposed capital access schedule

Under the proposed alternative income stream rules, products would qualify for the earnings tax exemption provided the maximum amount that could be returned to the product holder if they withdraw from the product at a later date declines in a straight line from commencement to life expectancy.

In addition, products would be able to offer a death benefit of up to 100 per cent of the nominal purchase price for half of this period, with the maximum death benefit limited to the capital access schedule thereafter.

For example, male life expectancy at age 65 is approximately 19 years.

Under this proposal, a product sold to a 65 year old male could offer a declining commutation value such that the amount of the purchase price that could be returned on withdrawal would be zero by age 84, but a death benefit of 100 per cent could be offered for around 10 years (to age 75). Income payments would continue for life (see Chart 2).

In the case of deferred products, the schedule would commence at the same time as the product becomes eligible for the earnings tax exemption. For example, where an individual retires at age 65 and buys a deferred annuity that pays an income stream from age 80, the earnings tax exemption and the depreciation schedule would both commence from age 65, even though income payments would not commence until age 80.

Chart 2

Here’s where housing construction is booming in Australia

From Business Insider and HIA.

Australia has been on an epic residential building boom in recent years, constructing more homes than ever before in the 2015/16 financial year.

And nowhere has this been more evident than in the locations listed below.

Courtesy of Australia’s Housing Industry Association (HIA), it shows Australia’s top 20 residential building “hotspots” for the 2015/16 financial year.

Here’s the list released in a report from the group over the weekend.

Source: HIA

The HIA deems a “hotspot” to be a region where population grew above the 1.4% national average and where at least $150 million worth of residential building was approved during the year.

Perhaps unsurprisingly, the group found that nine of the top 20 Hotspots were in New South Wales, with a further four and three located in Victoria and Queensland resectively.

And many of those were in inner-city regions, courtesy of an unprecedented level of apartment construction in these locations.

Pimpama, sandwiched between the Gold Coast and Brisbane in Southeast Queensland, was deemed to be the hottest of the hotspots in the 2015/16 financial year, logging population growth of 35.1% with $340.2 million worth of dwellings approved.

Cobitty-Leppington in Sydney’s Southwestern fringe, along with Palmerston in Darwin, took out second and third spots respectively.

Inner-city locations such as Docklands and Southbank in Melbourne, and Waterloo-Beaconsfield in Sydney, also made the top ten list.

While residential building activity across the broader Australian economy looks set to slow in the years ahead — building approvals have been trending lower, particularly for apartments, while the value of residential construction work done in the March quarter of this year fell — the HIA is forecasting that the decline will be modest, leaving total residential construction at elevated levels.

“Even though new dwelling starts will decline over the next couple of years, the annual volume of new home starts is not likely to fall below 173,000 at any stage,” the group said in early March this year.

“By any standard, this is still a very robust level of activity.”

Source: HIA

Treasury Says Housing Is A Key Economic Risk

There were a number of familiar themes in Secretary to the Treasury John Fraser’s opening address to budget estimates. But the section on household finances bears close reading. He says developments in the housing market will remain a key risk to the outlook and the near term the outlook for wage growth remains subdued, reflecting spare capacity in the labour market.

Household consumption has grown in recent years, but below historical rates with average growth in consumption per capita of just 1.1 per cent since the GFC.

This partly reflects weak per capita income growth over this period.

Consumption accounts for around 60 per cent of GDP and almost half of GDP growth so it is a critical factor in determining the strength of the economy.

We expect household consumption to pick up over the forecast horizon and continue to grow by more than household income, as labour market conditions improve and wages growth picks up. This would result in a further decline in the household saving rate.

Still, there are risks to the real economy around the momentum in household consumption – in particular, a change in households’ attitudes toward saving could lead to household consumption being weaker than forecast.

Wage growth has recently been low by historical standards, with the wage price index growing by 1.9 per cent through the year to March 2017.

We expect wages growth to increase as domestic demand strengthens, but in the near term the outlook for wage growth remains subdued, reflecting spare capacity in the labour market.

The near term outlook for inflation is also subdued.

Although full-time employment has strengthened recently, labour market conditions have generally softened after strong employment growth in 2015, with the majority of employment increases over the last 18 months being been in part time employment.

All that said, the unemployment rate remains below 6 per cent and indicators such as job advertisements, vacancies and business survey measures suggest labour market conditions will improve.

Employment is forecast to grow by one and half per cent through the year to the June quarters of 2018 and 2019 and the unemployment rate is forecast to decline modestly through the forecast period – consistent with an improving outlook for business and the economy overall.

Housing and dwelling investment

Household balance sheets have been strengthened by a notable rise in the value of housing and superannuation assets since the GFC, with household assets now more than five times higher than household debt.

We should be mindful that household debt has grown more rapidly than incomes in recent years, driven in particular by increasing levels of housing debt.

Dwelling prices have increased by 16 per cent through the year in Sydney and 15.3 per cent in Melbourne, though there have been some recent indications that this growth is moderating.

It is also important to emphasise that in other cities and regions, prices have been growing more moderately or declining for some years.

There are a number of complex factors that drive the housing market across both the demand side and the supply side.

For instance, there is no doubt that low interest rates have combined with population growth along the east coast to increase demand and support greater dwelling investment.

At the same time, insufficient land release, complex planning and zoning regulations and public aversion to urban infill have impacted the supply of housing.

Residential construction activity was subdued in the mid‑to-late 2000s leading to a state of pent-up demand in the housing market.

But activity has strengthened since 2012 with significant investment in medium-to-high density dwellings.

As the current pipeline of dwelling construction reaches completion over the next two years it is likely that dwelling investment will ease as a share of the economy.

Developments in the housing market will remain a key risk to the outlook, and the Treasury and our regulatory counterparts will be paying close attention to adjustments in the market.

As the steps taken recently by the Australian Prudential Regulation Authority demonstrate, there is a role for sensible and careful measures that can address risks and underpin market stability – and we will continue to focus on these going forward

AI and the Future of Mortgage Lending

From The Adviser.

The managing director of online mortgage broker uno. has suggested that artificial intelligence in mortgages could disrupt the industry and change the way broking works.

Speaking to The Adviser, Vincent Turner outlined that currently, online mortgage platform uno. allows users to look at different loans suited for their needs, which are then supported by a team of advisers.

Mr Turner said: “There is the presumption that if it’s digital, it means you’re doing it yourself. But, today, our advisers look at deals in the same way a broker would. We work out things the platform doesn’t, yet, work out.”

However, the managing director suggested that as technology catches up, the role of brokers and advisers will change.

He said: “Every month, we improve the insights available in the platform, or the rules that are in the platform, so that more and more of the stuff that we get a broker to do today – looking at it, and having credit knowledge — will be in the platform. Anything that a human can learn about credit policy, you can teach a computer.

“Now at that point, the intelligence in the platform starts to surpass that of an individual broker because it’s across every lender we deal with, and the service person’s role becomes less around who will approve it (because that logic will be inside the platform), and more about how do we structure this deal.”

Mr Turner estimated that uno., could, “within a year from now”, have the algorithm rules to know who will lend the money, how much they’ll lend, how much will cost, and whether they’ll approve it.

However, he said that if the lenders “work out how to do lending decisions in real time, without involving people at their end”, there could be a point where the intelligence “gets beyond our own”.

Mr Turner explained: “If you move forward 10 years, the lenders, I believe, are going to make lending decisions quite differently. With the advent of ubiquitous machine learnings and AI, the credit policies could be evolving on a minute-to-minute basis. That’s where I think it’ll end up on the next five to 10 years… And, if that’s all changing real time and the algorithms work out how to get smarter and smarter, then, the concept of a broker doesn’t really exist. It’s basically platforms that are plugged into what the lenders are using to make decisions.”

When asked whether AI could spell the end of brokers, he said: “Well no, not now. Not two years from now, five years from now. Even seven to 10 years from now, I doubt it. But, I don’t know.

“Each year, we get closer to where technology can make the entire lending decision. As long as you give it all the data and the documents, and you can assume that any documents you give it, it’ll be smart enough to pull the data off those documents, populate it into a data file, then the lenders who can make decisions just based on uploading all of the documents you need for a particular person, they will win.

“And, if there’s still the concept for broker, it’ll be a platform that has access to all of those lending algorithms.”

He concluded: “Inevitably, a mortgage will be: have you enabled me to do the thing I want to do, as fast as possible, with the least amount of effort, at the lowest possible cost?… It’s competition, you know.

“It’s annoying, but it’s good for the customer.”

“Absolute rubbish” that brokers are being replaced by technology

Many in the broking industry have been quick to reassure that AI and fintech would not threaten the mortgage industry, with former RESI CEO Lisa Montgomery telling The Adviser earlier this week that the proliferation of technology companies coming to the fore is actually of “detriment” to the borrower.

She explained that this was because you “cannot run your personal financial platform without the guidance and support of someone who knows how to articulate it correctly to pay the least amount of interest and to pay things off quickly”.

Likewise, the former chief executive of the Stargate Group and a leading fintech consultant has said that despite technology becoming more prevalent in the mortgage space, “brokers aren’t going anywhere” and could actually be on their way to writing 80 per cent of home loans.

Speaking to The Adviser, Brett Spencer, the former CEO of the Stargate Group and executive director of TICH Consulting Group, said that he thinks anyone who believes the broking industry is being replaced by technology is talking “absolute rubbish”.

Mr Spencer said that the fact an abundance of “fintech” solutions are coming to the market is exactly the main driver behind brokers remaining relevant and increasingly relied upon by consumers.

He explained: “The reason brokers are here and will continue to be here, and market share will grow… is that the sheer proliferation of the number of mortgage products in the market today is in the thousands.

“You talk to any one lender and they might say they have three products, but there are probably 30 variations on those products. Joe Consumer just doesn’t understand it.

“No matter how good an online platform you have, no matter how good a technology solution you have — Joe Consumer still wants to talk to a broker who is the expertise. And so, brokers will be here to stay. There is no question about it.”

NAB Cuts LVR on Interest Only loans

From Australian  Broker.

National Australia Bank (NAB) has slashed the loan to valuation ratio (LVR) on its interest only loans as it works to fulfil new regulatory requirements.

The changes, effective from 10 June, will set the new maximum LVR for interest only loans at 80%. Previously, this sat at 95% for owner occupiers and 90% for investors.

“NAB is making changes to some of its policies regarding interest only home loans to ensure we continue to meet our regulatory requirements and responsible lending obligations,” the bank said in a broker note

These changes come into play as a result of the 30% cap on interest only lending set out by the Australian Prudential Regulation Authority (APRA) on 31 March. The regulator has requested that this speed limit be met by 1 July.

“As always, NAB wants to continue to ensure we provide customers with product solutions that are in line with their needs, and it is often the case that a principal and interest loan may be the most suitable arrangement.”

The new maximum LVR for construction loans has also been changed to 90%.

Auction Clearance Rate Remains Strong

From CoreLogic.

The amount of auction activity across the capital cities increased slightly this week, up from 2,824 last week to 2,850 this week, while this time last year auction volumes were lower, with 2,480 homes taken to auction across the combined capital cities.

This week’s preliminary weighted average clearance rate across the combined capitals was 74.6 per cent, increasing from 73.1 per cent over the previous week and up from 67.7 per cent one year ago. Melbourne saw the highest preliminary clearance rate across the cities at 77.3 per cent, down slightly from last week, while across the remaining cities; clearance rates increased week-on week with the exception of Adelaide and Tasmania where clearance rates fell.

 

The Property Imperative Weekly To 27 May 2017

Are First Time Buyers really under the affordability gun? What will the impact of the surprising slowdown in residential construction be? And how will the bank levy play out in the light of this week’s ratings downgrades? Find out as you watch the latest edition of the Property Imperative weekly.

First, are first time buyers are really finding it more difficult to enter the property market at the moment? The most recent statistics showed there was a bounce in the number of buyers, and this has been attributed to low interest rates, stagnating property price growth and enhanced first home buyer incentives. This despite property investors beating other purchasers to the punch.

Genworth, the Lender Mortgage Insurer, changed their underwriting guidelines to include the First Home Owner Grant as an acceptable source if other true ‘genuine savings’ cannot be found. Genworth’s new conditions also places responsibility on the lender to ensure the borrower is eligible to receive a FHOG at the time of the application.

Demographer Bernard Salt’s jocular observation of young adults wasting money on smashed avocado has been put into perspective. Even if young Australian do give up extravagant brunches and put the funds towards saving for a house, it will take years, or even decades, to accumulate enough cash for the deposit and stamp duty on a home. A 20% deposit and stamp duty required to buy a house in Sydney is $159,000, based on new data from CoreLogic. That’s equivalent to 20 years’ worth of smashed avo.

But then again, do first time buyers really need a 20% deposit? Back in 2015, the Reserve Bank noted: “the deposit required of a first home buyer is more often in the 5–10 per cent range.” Whilst regulators have tightened the screws since then, there are still mortgages with below 20 per cent deposits to be found, according to data from RMIT’s Centre for Urban Research. Many of these rely on access to Lenders Mortgage Insurance, which of course protects the bank, not the borrower directly.

A report from Standard and Poor’s highlighted the risks in the Australian mortgage sector, and said that LMI’s might get squeezed by tightening lending restrictions and elevated claims, especially from loans in Western Australia and Queensland.

Our survey data on First Time Buyers indicates that there is incredibly strong demand for property, from both new migrants and existing residents. But that they are finding it harder to get funding, despite some grants being available, thanks to low returns on deposits, and low or no wage growth which is making it harder to save in the first place. We do see some lenders loosening their lending criteria for first time buyers with a saving history, but they are looking harder at household expenses, so overall funding is still harder to come by than a year ago. Our data shows this clearly, and our latest core market data is available now for paying clients.

So back to the Standard and Poor’s assessment of the housing sector, and their rating of the banks. Some were surprised when the ratings agency came out with an assessment before the latest round of house price data is out, but their latest assessment is finely balanced, on one hand calling out the elevated risks emanating from rising household debt and risks of a property correction, whilst on the other suggesting that recent regulatory intervention should help to manage the adjustment.

But overall, risks are higher and their revised credit profiles reflect this with more than 20 entities downgraded. Whilst the majors rating has not changed – reflecting the implicit government guarantee that their “too-big-to-fail” status gives them, and Suncorp remains at its current rating, despite a tough quarter; both Bendgio Bank and Bank of Queensland took a downgrade.

The consequence for these regionals is that funding costs just went up (and probably by more than a 6 basis point tax on the majors would have given in relative benefit). They have high customer deposits, but again the regional bank playing field is tilting against them when it comes to long term funding. This put the bank tax into a different light, as the Government argued the tax would help level the playing field.

In addition, the big banks came out with an estimate of the impact of the proposed tax. The budget papers estimated it would yield more than $6 billion over 4 years, based on a 6 basis charge on selected liabilities.  The banks say on an annual pre-tax basis they would pay around $1.38 billion annually, but only $965m post tax (as the tax would be an allowable expense). The Government confirmed the tax would be tax deductable.

So, the tax won’t deliver the planned revenue, and the 6 basis points benefit the regional banks might have been expected to see relative to the majors has been more than offset by the credit downgrades. This has led to calls to lift the tax to deliver the full planned value, and also extend it to large foreign banks operating here.

But there is a broader point to consider. The majors are protected by the implicit guarantee that if they got into financial difficulty, the Government would bail them out. S&P explained this is why they were not downgraded, but went on to say if Australia’s country rating fell, they would be. It seems clear that as the levy is making the implicit guarantee more explicit, (such that Macquarie who is caught by the levy, got a ratings upgrade, whilst others like Bendigo and Adelaide Bank did not); the reach of this implicit guarantee is in question. To put it sharply, would the Government really let Bendigo fall over; we think not. So the whole question of who has and who does not have this protection is in the air. This all has a direct impact on funding costs, and product pricing. So how this plays out will directly impact the interest rates paid by mortgage holders and to savers.  We think the need for a proper inquiry into the bank tax just got stronger. It’s worth remembering the UK’s approach to a bank tax took three goes to get right!

What seems to have been a late play for more revenue from the Government has descended into the complexity of bank funding and risk.

Finally, ten years on from the 2007 Global Financial Crisis, there were a number of good summaries of what we have learnt. One of the best was from the St. Louis Federal Reserve. They said the root causes of the crisis could be traced to excessive mortgage debt, sharply higher mortgage rates, an overheated housing market and a lack of broad oversight/insight.

Stepping forward to the current situation in Australia, it seems to me these factors are alive and well here. Household debt has never been higher, mortgage rates are set to rise further whilst incomes are squeezed, home prices are too high on any measure, and the regulators only recently started to react to the true impact of debt exposed households. This, in the week the latest personal insolvency data  showed a significant rise, not just in WA, but across the nation and residential construction slowed last quarter, suggesting the number of new starts will continue to fall.

There was an excellent research piece from institutional investment fund JCP Investment Partners, picked up in the AFR.  Their granular analysis of the mortgage sector (including leveraging our data), underscores the risks in the mortgage books, and explains the RBA’s recent change of tune on household finances. Critically, they showed that many households have very high loan to income ratios.

In the light of this, we think S&P called the market right, and it’s now a question of whether we will get an orderly adjustment or not. The jury is out, but the latest home price data is also suggesting a fall, despite ongoing high auction clearance rates.

At best, we remain on a knife edge. Check back next week for our latest update.

Yet Another Bumper Saturday!

The preliminary auction clearance results are in from Domain. Nationally 1,222 properties sold, compared with 1,496 last week. This equates to a clearance rate of 74.8% compared with 72.9% last week, and 66.8% a year ago. So volumes down a little, but bumper sales.

Melbourne led the charge (again) with a 76.6% clearance rate with 679 sold, compared with 792 last week and 700 a year ago. Sydney hit 75.9% with 453 sold compared with 565 last week at 75.9% compared with 72% last week and 65.9 last year.

So whilst volumes may be down a little, there are plenty of buyers still wanting to close a deal!

Brisbane cleared 42% of the 110 scheduled auctions, Adelaide 62% of 69 scheduled, and Canberra 78% of 78 scheduled.