Auction volumes bounce back, but performance is varied across the major auction markets.
After a quiet week for auctions the previous week, auction volumes across each capital city market increased last week with 2,289 auctions held across the combined capital cities, compared to just 1,520 over the previous week. Last week, the preliminary auction clearance rate increased to 72.4 per cent, from 70.2 per cent the previous week, meaning that current auction clearance rates remain much stronger than they were one year ago (64.4 per cent). While overall, clearance rates increased over the week, it is interesting to note that across Australia’s two largest auction markets, Melbourne and Sydney, there was more than a 10 percentage point difference between the weekly results.
Last week, Sydney’s preliminary auction clearance rate was recorded at 82.7 per cent, the second strongest result for the year so far. There were 857 Sydney properties taken to auction last week, with volumes remaining virtually unchanged when compared to the previous week when there were 859 Sydney auctions, but a lower clearance rate of 78.8 per cent.
Currently, Sydney’s auction market continues to track at a much higher level when compared to one year ago. Over the same week last year, 650 Sydney properties were taken to auction with 70.4 per cent clearing.
In Melbourne, the preliminary clearance rate of 67.9 per cent was recorded this weekend from 885 auctions compared to 67.3 per cent last weekend and 66.4 per cent this time last year.
Listing volumes are now surging in both private and auction sale segments with 11 per cent more new residential listings over the last month compared to this time last year. Prospective vendors are clearly being encouraged by market activity in the first quarter of the year.
If this listing activity is matched by sales over the rest of the year we are likely to reach a level of transactions that both exceeds last year and the average over the previous decade. Final numbers for last year saw 81,590 sales in Melbourne. This was 11 per cent higher than 2012 but 5 per cent lower than the average over the previous decade.
Brisbane recorded a much stronger preliminary clearance rate last week (56.2 per cent) when compared to the previous week (45.0 per cent), however auction volumes have remained steady over the two week period, with 139 auctions held in the city last week, compared to 138 the previous week. Over the same week last year, 37.5 per cent of the 109 Brisbane properties taken to auction recorded a successful result.
Both auction clearance rates and the number of properties taken to auction in Adelaide increased last week, when the preliminary auction clearance rate was recorded at 69.6 per cent, compared to 63.2 per cent over the previous week and there were 94 auctions held in the city, up from 80 auctions the week prior. So far this year, there has only been one week where Adelaide’s auction clearance rate has fallen below the 60 per cent mark, while one year ago, just 48.7 per cent of the 82 properties taken to auction sold.
The number of auctions expected to be held across the capital cities this week will remain fairly steady, with RP Data currently tracking 2,297 auctions for the week.
*Melbourne auction commentary provided by Robert Larocca, RP Data’s Victorian Housing Market Specialist