Auction clearance rates have held firm across Sydney and Melbourne and volumes are set to rise, drawing some heat out of price growth in the lead-up to Christmas.
Preliminary results across combined capitals held above 70 per cent, with 71.7 per cent of the 2285 properties sent to auction cleared, slightly up on last week’s 71.2 per cent over a near-identical number of dwellings.
Capital city clearance rates held firm at 71.7 per cent. Nikki Short
CoreLogic head of research Tim Lawless said this week’s results were strong, but not explosive.
“It’s definitely not shooting the light outs, but against high interest rates and low sentiment, this is still a strong auction environment,” Mr Lawless said.
Sydney recorded a preliminary clearance rate of 73.4 per cent, slightly down on last week’s 73.8 per cent. The harbour city had 907 properties sent to auction, just down on the previous week’s 913.
In Melbourne, results tracked slightly up, with a preliminary clearance of 71.5 per cent across 1013 auctions, up from last week’s 69.3 per cent. However, Mr Lawless said the city’s figures were down compared to the first half of the year.
“Melbourne has been holding below 70 per cent on finalised numbers since the middle of June, and we are definitely not seeing clearance rates through the earlier phase of this recovery cycle,” he said.
Onlookers gather to watch 42 Lawson Street, Balmain, go to auction on Saturday.
Melbourne buyer’s agent David Morrell, of Morrell and Koren, described the weekend market as “a bit flat”.
“I went to four auctions, and they were all passed in,” Mr Morrell said.
Brisbane’s typically volatile auction market recorded a preliminary result of 59 per cent across 132 properties, while Adelaide clocked 88.9 per cent preliminary clearance for 130 homes.
CoreLogic’s Mr Lawless said rising auction volumes off an above-average base could temper future price growth.
“The key trend to watch through spring is rising auction numbers and volumes,” he said.
“If we continue to see stock levels rise when demand is still constrained through tight lending conditions, we could see some further price heat coming out of the market.”
As early spring listings translate to houses under the hammer, a rebalancing of undersupply could moderate price growth in the final quarter, something Mr Lawless said was a “positive outcome”.
“Sydney house values were growing 2 per cent month on month, but a capital gain getting to 0.5 to 1 per cent month on month would be much more sustainable,” Mr Lawless said.
In Sydney’s inner west, a three-bedroom home sold under the hammer for $3.24 million, $640,000 over the initial $2.6 million price guide.
Selling agent The Agency’s Shad Hassen said there was strong interest in the turnkey family home in Dulwich Hill, upgrading the guide to $2.8 million by the end of the campaign.
This home at 21 Hampstead Road in Dulwich Hill sold at auction for $3.24 million.
“We expected a strong result and strong competition,” Mr Hassen said. There were 22 contracts out before the sale.
At the packed Saturday-morning auction, three parties battled it out in rapid-fire bids to take the price well above the $2.8 million reserve.
“We had eight registrations, and with an opening bid of $2.8 million, there were some people missed early.”
Speaking more broadly on interest rate pressure, the agent said he was seeing few signs of forced selling.
“What we’re seeing is some investments popping onto the market, with people reshuffling their portfolio,” Mr Hassen said. “But we’re not seeing an influx of distressed sales.”
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