- Australia’s preliminary auction clearance rate softened last week despite a sharp reduction in the number of properties going under the hammer.
- The lower result was driven by weaker readings in Melbourne and Sydney, offsetting modest improvements in most smaller capital city markets.
- CoreLogic will release updated price data for Australia’s five mainland state capitals later today.
Australian auction clearance rates softened last week despite a sharp reduction in the number of properties going under the hammer.
According to CoreLogic, a combined capitals preliminary clearance rate of 55.9% was achieved, down from the 56.7% preliminary estimate offered a week earlier.
1,400 auctions took place across the country, lower than the 1,671 held in the prior week. Within that figure, CoreLogic received just 1,087 results, pointing to the likelihood of a steep downward revision when the final figures are released on Thursday.
In late June, a final clearance rate of 52.6% was achieved across Australia’s capitals. One year ago, the combined capitals clearance rate was 68.4%.
610 properties sold either before, at or after auction last week. 477 were unsuccessful, either failing to clear or withdrawn prior to going to auction.
“The weighted average has remained within the mid-50% range for each of the last eight weeks, while one year ago 65-70% of homes were selling over the same period,” CoreLogic said.
“Although the capital city weighted average is substantially lower than a year ago, auction results are holding stronger relative to the 2010-2012 downturn in home values when the capital city clearance rate held below 50% between mid-2011 and early 2012.”
In contrast to the theme seen in recent months, clearance rates for houses outperformed units last week, standing at 56.2% and 55% respectively.
By capital, preliminary clearance rates in Melbourne and Sydney both fell, dragging the national average lower.
“There were 632 Melbourne homes taken to auction this week, returning a preliminary clearance rate of 58.2%,” CoreLogic said.
The result was below the 60.3% preliminary estimate offered a week earlier. With over 100 results not reported, it suggests the final figure may come in below the 57.2% level seen during that week.
Sydney’s preliminary clearance rate also slipped, falling to 55.1%, down from 56.4% a week earlier. The 56.4% preliminary estimate was revised lower to 49.7% as late results filtered in.
With 152 results not reported for last week, Sydney’s final figure could well come in under 50% once again.
Across the smaller capitals, preliminary clearance rates improved in Brisbane, Adelaide and Perth but weakened fractionally in Canberra.
Like Melbourne and Sydney, auction volumes fell in all markets except for Canberra.
Given the weak results seen in Melbourne and Sydney, it points to the likelihood that prices in both cities will continue to fall in the period ahead.
In the June quarter, the median home price in Melbourne and Sydney fell by 1.4% and 0.9% respectively, according to CoreLogic.
The group will release updated weekly price movements for Australia’s five mainland state capitals later today.
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