- Australian preliminary auction clearance rates inched higher last week.
- Volumes across the capitals were higher than a week earlier. Reporting rates were unchanged at 69.5%.
- Given that most late results are for properties that failed to clear, a final clearance rate of just above 50% is likely to be seen when updated figures are released later in the week.
- While clearance rates have rebounded in recent months, home prices have continued to fall, including in March.
Australian auction clearance rates inched higher last week despite an increase in homes going under the hammer.
According to CoreLogic, a preliminary clearance rate of 56.8% was recorded across Australia’s capital cities, a modest improvement from the 56.0% level reported in the prior week.
The modest uptick came despite an increase in properties being taken to auction, lifting to 2,155 from 1,669 seven days earlier.
CoreLogic received results from 1,498 of the 2,155 auctions held, or 69.5%, identical to the level seen in the preliminary estimates released a week earlier.
Of those results received, 848 homes sold prior to, at or after auction while 650 failed to clear, including 98 properties that never made it to market.
Clearance rates for apartments were stronger than for houses across the capitals during the week, standing at 60.4% and 55.4% respectively.
By individual capital city market, Sydney recorded the highest preliminary clearance rate of 65.9%.
Volumes in Sydney were higher than a week earlier and reporting levels improved to 64% from 60% in the prior week.
Still, reporting rates across Australia’s largest and most expensive housing market are still weak compared to periods in the past, pointing to the likelihood of a sharp downward revision to the mid to high 50% region when final figures are released on Thursday.
“Preliminary estimates for Sydney should be treated with extra caution at the moment,” said Matthew Hassan, Senior Economist at Westpac Bank.
“However, the latest adjusted weekly clearance rate would still be comfortably in the 50-55% range [that is] consistent with stabilising prices.”
Outside of Sydney, Melbourne’s preliminary clearance rate dipped to 53.4%, down from the initial estimate of 57% released seven days earlier. Like Sydney, volumes in Melbourne increased week-on-week.
Across the smaller capital city markets, preliminary clearance rates in Brisbane, Adelaide and Perth all increased during the week but weakened substantially in Canberra.
Given reporting rates during the week, the national preliminary clearance rate of 56.9% is likely to be revised down to the low 50% range in the coming days.
In the prior week, the preliminary estimate of 56% was revised down to show a final clearance level of 50.9%.
While auction clearance rates lifted in the March quarter compared to the levels seen late last year, prices have continued to decline, indicating the improvement may reflect more realistic expectations among vendors.
According to separate data released by CoreLogic on Monday, capital city home prices fell by 0.7% in March in average weighted terms, driven by broad-based weakness across all markets with the exception of Hobart and Canberra.
Sydney and Melbourne led the national losses with declines of 0.9% and 0.8% reported, extending the falls over the past year to 10.9% and 9.8% respectively.
The annual decline in Melbourne was the largest in percentage terms on record.