- Australian housing clearance rates fell to the lowest level in over two years in early May.
- Preliminary data from CoreLogic suggests they may have fallen even further last week, pointing to further downside pressure prices.
- CoreLogic will release data on home prices and property listings later today.
Australian auction clearance rates fell to the lowest level in over two years in early May, driven by weak results for Sydney and Melbourne, Australia’s largest and most expensive property markets.
There’s little sign of that trend reversing based off the latest data.
According to CoreLogic, a preliminary combined capital city clearance rate of 60.3% was recorded last week, down from the 61% preliminary result reported one week earlier.
It was also well below the 73.1% final clearance rate seen in the same corresponding week of 2017.
The slide in the preliminary figure came despite few properties going under the hammer, falling to 2,089 from 2,279 a week earlier.
Of those auctions held, CoreLogic received results from 1,621. 983 properties sold and 638 were passed in.
Continuing the trend of prior weeks, clearance rates for units continued to outperform those for houses, standing at 63.5% and 59.1% respectively.
Given the large proportion of unreported results, and tendency for final clearance rates to be revised down from preliminary results, there’s a strong possibility the final clearance for the week could come in below the 58.2% level reported one week ago.
By individual capital, Melbourne’s preliminary clearance rate improved modestly after hitting a more than four-year low a week earlier.
“In Melbourne, Australia’s largest auction market, a preliminary auction clearance rate of 64.2% was recorded across 1,028 auctions this week, up from 59.8% across 1,099 auctions last week,” CoreLogic said.
“One year ago, the clearance rate was a stronger 77.9% across 1,326 auctions.”
The preliminary result was an improvement on the 61.2% preliminary figure reported a week earlier.
However, while Melbourne’s market firmed slightly, Sydney’s preliminary auction clearance rate fell.
“There were 669 auctions held in Sydney this week returning a preliminary auction clearance rate of 60.8% compared to 57.5% across 787 last week and 74.0% across 1,075 auctions one year ago,” CoreLogic said.
In the previous week, Sydney recorded a preliminary result of 62.5%.
Given the tendency for downward revisions, the clearance rates reported in both Melbourne and Sydney both point to the likelihood of further price declines in the period ahead.
Outside of Australia’s largest auction markets, preliminary clearance rates fell in most other capital cities during the week.
They weakened in Brisbane, Adelaide and Canberra but rose modestly in Perth.
Following the release of the preliminary auction results, markets will receive updated price data from Australia’s five mainland state capital cities later today.
Prices have been trending lower in recent months, especially in Sydney and Melbourne, with total property listings currently sitting well above the levels seen one year ago.
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