Australian auction clearance rates inch higher despite a larger number of properties going under the hammer

Michael Dodge/Getty Images
  • Australian auction clearance rates rebounded last week despite an increased number of properties going under the hammer.
  • Clearance rates remain well below a year ago, especially in Melbourne, Australia’s busiest auction market.
  • CoreLogic will release weekly price data for Sydney, Melbourne, Brisbane, Adelaide and Perth later today. Over the past year the median home price in these capitals has fallen by 3%, according to latest data.

Australian auction clearance rates rebounded last week despite an increased number of properties going under the hammer.

According to CoreLogic, a preliminary combined capitals clearance rate of 57.9% was achieved, up from the 56.7% preliminary estimate offered one week earlier.

The modest uptick came despite an increase in properties hitting the market, lifting from 1,692 to 1,909 week-on-week.

Of the 1,909 auctions held, CoreLogic received results from 1,440. Within that figure, 837 properties sold either before, at or after auction while 603 failed to clear, including 112 that were withdrawn prior to being taken to market.

The large number of unreported auction results, some 469, points to the likelihood that the final clearance rate for the week will be revised lower when released on Thursday.

In the prior week, the preliminary rate was revised down to show a final clearance level of 53.3%.

One year ago, the combined capitals clearance rate stood at 68.3% despite a significantly higher number of auctions taking place.

CoreLogic

“Auction volumes have slowly started to increase over the last couple of weeks however current volumes remain lower than this time last year when 2,270 auctions were held,” CoreLogic said.

“Through winter, the number of homes taken to auction has been tracking roughly 20% lower than a year ago, highlighting a substantial weakening in vendor confidence driven by the softer housing market conditions and consistently lower clearance rates.”

Looking specifically at last weeks performance, CoreLogic said clearance rates for units continued to outperform those for houses, continuing the trend seen in recent months.

“Looking at results by property type, units outperformed houses once again this week with 60.9% of units selling at auction, while 56.7% of houses sold across the combined capital cities,” it said.

By individual capital, Sydney and Melbourne, Australia’s largest auction markets, both recorded preliminary readings below 60%.

“There were 717 auctions held in Sydney this week returning a preliminary clearance rate of 59.1 per cent,” CoreLogic said. “In comparison, there were 572 auctions held over the previous week and the final auction clearance rate was 51.9%.”

In the prior week, Sydney’s preliminary clearance rate stood at 56.5%.

Melbourne’s preliminary clearance rate also improved from 55.7% to 58.6% week-on-week, albeit it still remained below the level recorded in Sydney.

“In Melbourne a preliminary auction clearance rate of 58.6% was recorded across 898 auctions this week, while last week there were 860 auctions returning a final clearance rate of 54.0%,” CoreLogic said.

Despite the improvement recorded in both markets last week, both figures remained well below the 67.4% and 72.3% levels respectively seen in the same corresponding week a year ago.

CoreLogic

Across the smaller capitals, Canberra’s preliminary clearance rate rose while those in Brisbane, Adelaide and Perth all softened.

Despite the modest rebound recorded in the national figure last week, current levels continue to point to further price declines in the period ahead.

Last week, CoreLogic reported that home prices across Australia’s mainland state capitals — Sydney, Melbourne, Brisbane, Adelaide and Perth — fell by 0.1% in average weighted terms, leaving the decline over the past month at 0.6%.

Over the past year, the median home price in these capitals slipped by 3%, led by declines of 5.6%, 2.1% and 1.4% respectively in Sydney, Perth and Melbourne.

CoreLogic is set to release updated weekly price movements across these capitals later today.

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.