Australian auction clearance rates rebound after falling to a near 2-year low in early October

GOLD COAST, AUSTRALIA – DECEMBER 17: David Mead climbs the obstacle course during a Gold Coast Titans NRL pre-season training session at aquaSplash Water Park on December 17, 2013 on the Gold Coast, Australia. (Photo by Matt Roberts/Getty Images)

Australian capital city auction clearance rates rebounded last week after falling to the lowest level since January 2016 in early October, driven by an uptick in Sydney and Melbourne.

However, that wasn’t enough to boost house prices which came in flat, continuing the slowdown seen in recent months.

According to preliminary figures released by CoreLogic, a national clearance rate of 70.6% was reported last week, up marginally on the 68.1% preliminary level reported in the previous week.

“There were 2,497 auctions held across the combined capital cities this week, up from 2,318 last week,” said CoreLogic.

“So far, 2,007 results have been reported to CoreLogic, returning a preliminary clearance rate of 70.6%, increasing from last week when the final clearance rate slipped to 64.4%, the lowest clearance rate since January 2016.”

Source: CoreLogic

Helping to explain the national lift in preliminary clearance rates, those in Melbourne and Sydney both increased from a week earlier.

“Melbourne was host to 1,208 auctions this week, returning a preliminary clearance rate of 74.8%,” CoreLogic said.

That was higher than both the preliminary and final clearance rates reported for the prior week of 72.1% and 70.3% respectively.

Sydney’s preliminary auction clearance rate also rose to 69.5%, up from the prior week’s preliminary reading of 67.2%. It was also well above the final reading for last week of 61.3% which was the lowest in close to two years.

Despite the rebound in both markets, clearance rates still remained well below the levels reported a year earlier, especially in Sydney.

That can be seen in the table below from CoreLogic, which shows the preliminary performance of Australia’s capitals last week.

Source: CoreLogic

Of the smaller capital cities, preliminary clearance rates rose in all locations aside from Perth.

“While we expect the clearance rate to revise over the next few days as the remaining results are collected, it will be interesting to see how the clearance rate holds up on Thursday when the final figures are released,” said CoreLogic.

“Over the corresponding week last year, auction volumes were similar, with 2,443 properties taken to auction, while the clearance rate was stronger at 76.2%.”

Final clearance rates tend to be revised below preliminary estimates as tardy, often unsuccessful results are reported to the group.

Despite the modest increase in clearance rates, it wasn’t enough to boost house prices which were unchanged over the week.

According to CoreLogic, prices fell by 0.2% in Sydney, offsetting gains of between 0.1% to 0.2% across Australia’s remaining mainland state capitals.

The flat outcome left growth over the past four weeks at 0.2%, seeing the increase over the past year slow to 7.9%.

This table from CoreLogic shows the price performance of individual state capitals, looking at the change over the week, month, year and past 12 months.

Source: CoreLogic

NOW WATCH: Money & Markets videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.