- Australian auction clearance rates could fall below 40% this week given preliminary estimates.
- In early December, just 41% of homes taken to auction sold, the lowest proportion in over seven years.
- No Australian capital city is seeing clearance rates exceed 50% at present.
Australian auction clearance rates fell again last week, pointing to the possibility a sub-40% result when final numbers are released on Thursday.
According to CoreLogic, a combined capitals preliminary clearance rate of 43.8% was reported last week, slipping from 45.3% seven days earlier.
A total of 2,406 home nationwide went under the hammer, down slight from 2,614 in the prior week.
Of those auctions held, CoreLogic received results from 1,737, equating to a reporting rate of 72.2%. That was up from 70% in the prior week.
771 homes sold prior to, at or after auction while 966 properties failed to clear, including a sizeable 248 that never made it to market.
Despite the improvement in reporting levels, given that preliminary figures tend to be revised lower over time, final clearance rates for the week could come in below 40%.
In the prior week, the preliminary result was revised down to show a final figure of 41%, the lowest since October 2011.
One year ago, Australia’s final combined capitals clearance rate stood at 60.7% from 2,890 auctions held.
By type of property, apartment clearance rates continued to top those for houses last week, standing at 46.5% and 42.6% nationally last week.
Helping to explain the decline in the nationwide preliminary clearance rate, success rates in Sydney fell sharply from a week earlier, dropping to 43.6% from 48.1% in the prior seven day period.
“It will be interesting to see whether or not the final clearance rate can hold above 40% this week,” CoreLgic said.
Reporting rates in Sydney were far improved from a week earlier, lifting to 72.2% from 65.3%. That points to the potential for a smaller downward revision to Sydney’s final clearance rate compared to recent trends.
As opposed to Sydney, Melbourne recorded the complete opposite result last week — its preliminary clearance rate improved as reporting levels weakened.
CoreLogic said Australia’s second largest and second most expensive city recorded a preliminary success rate of 46.9%, up from 46.1% a week earlier. Reporting rates fell from 80.7% to 79.1% seven days earlier.
Melbourne’s preliminary clearance rate was revised down to show a final result of 43.8% last week.
A year ago, Sydney and Melbourne recorded final clearance rates of 52.7% and 65.9% respectively. Melbourne’s market, in particularly, has cooled dramatically over this period, mirroring what was seen earlier in Sydney.
Across the smaller capitals, preliminary clearance rates improved in Brisbane and Canberra but fell in Adelaide and Perth.
Auction activity will slow sharply in the coming week due to the onset of holidays across Australia. It will likely remain that way until well into February next year.
CoreLogic will release weekly price movements from Australia’s five mainland state capital cities later today. Final clearance rates for last week will arrive on Thursday.
NOW READ: The Sydney property falls are accelerating, and the last time they fell this far Australia had a recession
Business Insider Emails & Alerts
Site highlights each day to your inbox.