Australian auction clearance rates hit the lowest level this year -- and it was driven by Sydney

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  • Australian auction clearance rates fell to the lowest level this year last week.
  • The decline was largely due to a steep drop in Sydney, more than offsetting an improved performance in Melbourne.
  • Auction volumes look set to fall this weekend, including in Melbourne and Sydney.

Australian auction clearance rate fell to the lowest level this year last week, dragged lower by a steep decline in Sydney, Australia’s largest and most expensive property market.

Final figures from CoreLogic revealed just 60.3% of properties sold, down from 62.2% one week earlier.

It was the lowest combined capital city figure since late last year.

Source: CoreLogic

CoreLogic said the decline coincided with an increase in properties going under the hammer, lifting to 2,577 from 1,799 in the prior week.

As seen in the table below, the national decline was largely due to a steep drop in Sydney’s clearance rate, overriding a stronger performance in Melbourne.

Source: CoreLogic

“Sydney’s final auction clearance rate dropped to its lowest level over the year-to-date, with only 55.8% of auctions clearing,” CoreLogic said.

“There were 829 auctions held across the city which was considerably higher than the 588 auctions held over the week prior when a much stronger 63.6% cleared.”

In contrast, and despite an increase in auction volumes, Melbourne’s clearance rate rose over the week.

“Melbourne’s final auction clearance rate last week maintained strength with a total of 1,334 auctions held returning a 63.9% rate of clearance, increasing slightly from the week prior when 63.6% of the 914 auctions held were successful.”

Source: CoreLogic

Despite the divergence in Australia’s largest auction markets, CoreLogic reported that prices in both cities fell during the week, dropping 0.1% in Sydney and 0.2% in Melbourne.

Year-to-date, prices in both cities have fallen 2.1% and 0.9% respectively, dragged down by a combination of tighter lending standards, affordability constraints, deteriorating sentiment towards the outlook for both markets and a sharp lift in property listings.

Like Sydney and Melbourne, CoreLogic said auction volumes lifted in all other capital city markets last week with a mixed performance recorded.

“All of the smaller auction markets saw an increase in activity last week. Clearance rates were varied, however,” it said.

“Adelaide and Tasmania recorded a fall while Brisbane and Perth returned stronger results, and Canberra’s clearance rate remained steady.”

Looking to the week ahead, CoreLogic says auction volumes look set to decline, largely driven by a slowdown in Sydney and Melbourne.

“CoreLogic is currently tracking 2,075 auctions, down on final results last week which saw 2,577 auctions held,” it said.

“While a significantly lower 1,689 auctions were held over the corresponding week last year.”

1035 auctions are scheduled to take place in Melbourne, down from 1,334 in the prior week, while volumes will also drop in Sydney from 826 to 706.

All remaining capital cities are expected to host fewer auctions than a week ago.

The busiest markets by individual suburbs are all located in Melbourne, led by Craigieburn with 20 properties set to go under the hammer.

NOW READ: The relationship between auction clearance rates and Sydney home prices, in one chart

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