Australian auction clearance rates have stabilised, having fallen modestly from levels seen earlier in the year, suggesting that house price growth will continue to slow, rather than stall, in the period ahead.
According to CoreLogic, a national preliminary clearance rate of 69.4% was recorded across Australia’s capital cities last week, down marginally on the 70.6% preliminary level reported one week earlier.
That preliminary figure was subsequently revised down to 67.1% when the group released final data for the week last Thursday.
“The combined capital cities returned a preliminary auction clearance rate of 69.4% this week, marking the 21st consecutive week where the clearance rate has held below 70%,” said CoreLogic.
By individual capital, it was a familiar theme with Melbourne continuing to outperform Sydney in terms of the nation’s largest auction markets.
Here are the preliminary results for last week, comparing auction volumes and clearance rates compared to the same corresponding week a year earlier.
“Across Melbourne, preliminary results show that 73.3% of the 1,030 reported auctions sold this week,” CoreLogic said.
That was below the preliminary figure of the previous week of 74.8%, but marginally above the final reading of 73.2%.
Sydney’s preliminary clearance rate fell from 69.5% to 68.8% week-on-week, although it remained above the final figure of 63.3% released last Thursday.
“The trend towards softer auction market conditions has been led by the Sydney market where the final auction clearance rate has remained below 65% since the first week of October,” said CoreLogic.
Given that preliminary figures tend to be revised lower as late, often unsuccessful results filter through the group, there’s a good probability that trend will continue when finalised figures are released later in the week.
Of the smaller auction markets, preliminary rates rose in Brisbane and Tasmania but fell in Adelaide, Perth and Canberra.
Nationally, the 69.4% preliminary clearance rate remains well below the 78.1% level seen one year earlier, primarily reflecting the slowdown seen in the Sydney and Melbourne markets.
CoreLogic will release updated weekly house price data for each of Australia’s five mainland state capitals later today.
If the recent relationship between auction clearance rates and prices is maintained, it’s likely to show that price growth has continued to slow from the levels seen earlier this year, reflecting affordability constraints and attempts from Australia’s banking regulator, APRA, to curb investor activity in the housing market.