Australian clearance rates still point to strong growth in house prices

Photo by Mark Mainz/Getty Images

Australian auction clearance rates continue to point to strong price growth in the period ahead, albeit not to the same degree seen earlier in the year.

According to data released by CoreLogic today, a final capital city clearance rate of 68.2% was recorded last week, continuing the remarkably steady trend since the beginning of June.

Each and every week since then, clearance rates have come in just under 70%.

This chart shows the evolution in clearance rates across the country over the past six years.

Source: CoreLogic

While lower than the levels seen in the first quarter of the year, clearance rates around these levels have historically led to price growth across Australia’s capital cities of around 10% per annum in average weighted terms.

That national figure reflects the trends in Australia’s two largest auction markets, Sydney and Melbourne.

Source: CoreLogic

By capital, and continuing a familiar theme, Melbourne once again registered the strongest clearance rate last week at 73.9%, although that was fractionally below the 75.6% level of the week before.

Reflecting the strength compared to other capitals, Melbourne has also recorded the fastest growth in house prices across the country, both over the past month and year.

After logging its lowest level this year in the prior week, Sydney’s clearance rate bounced back to 66.4% from 65.4%.

Across the smaller capital cities, Perth and Tasmania’s clearance rates improved last week, while Adelaide, Brisbane and Canberra saw a fall in clearance rates, CoreLogic said.

Turning to the week ahead, 1,867 properties nationwide are scheduled to go under the hammer, almost unchanged from the prior week.

Stability and predictability all round, right?

Melbourne remains the busiest auction market with 880 properties up for sale, while 738 will be offered in Sydney.

Reservoir, in Melbourne, will be the busiest individual auction market with 17 properties going under the hammer. Kew and Pascoe Vale, also in Melbourne, will hold 13 auctions each.

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