Australian auction clearance rates inch higher despite a lift in mortgage rates

Matthias Hangst/Getty Images
  • Australian auction clearance rates improved modestly last week despite more lenders announcing an increase in variable mortgage rates.
  • Reporting levels were weaker than the prior week, a result that may have boosted the national average.
  • CoreLogic will release weekly price movements from Australia’s five mainland state capitals later today.

Australian auction clearance rates inched higher last week despite ANZ and the Commonwealth Bank joining a swathe of other lenders in announcing an increase in variable mortgage rates.

According to CoreLogic, a preliminary combined capitals clearance rate of 59.1% was achieved, up marginally from the 58.2% preliminary level reported one week earlier.

CoreLogic received results from 1,382 of the 1,907 auctions held, representing a reporting rate of 72.5%. In the previous week the group received results from 77.3% of the 1,752 properties that went under the hammer.

The drop in reporting levels likely helped to boost the preliminary clearance rate reported last week. It also suggests that final figures for the week — released on Thursday — will be revised down from preliminary estimates.

In the prior week a final clearance rate of 55% was achieved, down from the preliminary estimate of 58.2%.

One year ago, the combined capitals clearance rate stood at 66.9%.

CoreLogic

Of the 1,382 auction results received so far, CoreLogic said 827 properties sold prior to, at or after auction. 555 properties failed to sell including 109 withdrawn prior to going to market.

By type of property, preliminary clearance rates for apartments continued to outperform that for houses, standing at 63.9% and 57.1% respectively.

In terms of the performance of individual capital city markets, Melbourne’s preliminary clearance rate improved from 59.1%, helping to boost the national average.

“In Melbourne, a preliminary auction clearance rate of 62.4% was recorded across 894 auctions this week, up from 57% across a lower 805 auctions last week,” CoreLogic said.

“One year ago, the clearance rate was a stronger 71.8% across a significantly higher volume of auctions at 1,111.”

CoreLogic

The improvement in Melbourne’s preliminary figure helped to offset a decline in Sydney from 58.6% one week earlier.

“There were 654 auctions held in Sydney, returning a preliminary auction clearance rate of 57.8%,” CoreLogic said.

“Last week, there were 664 auctions held and the final auction clearance rate was 53.8%, while one year ago, 826 Sydney homes went to auction and the clearance rate came in at 65.8%.

So despite the varied performance last week, clearance rates in Melbourne and Sydney are still well down on the levels of a year ago, even with fewer properties being taken to auction.

It also suggests the measured decline in prices in both cities this year will likely continue in the period ahead. CoreLogic will release updated weekly price data from Australia’s five mainland state capitals later today.

Across the smaller capitals, Adelaide recorded the highest preliminary clearance level at 64.8%, up from the 61.7% preliminary rate reported a week earlier.

Clearance rates also improved in Brisbane and Canberra but weakened in Perth, another capital where prices have been falling for several years.

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