Property auctions keep post-election energy for second month in a row

Mark Metcalfe/Getty ImagesA prospective buyer bids during the auction of a home in Sydney.

Sydney and Melbourne auctions have kept up their post-election energy but low auction volumes are likely to weaken the market pulse while house prices are still largely flat.

This is the second month of a steady lift in housing activity since the federal election and Sydney posted a preliminary clearance rate of 67.1 per cent and Melbourne, 69.7 per cent, according to Corelogic.

After adjusting for auction withdrawals and other slippages, final numbers could sit in the low 60s for both cities, property watchers say.

“The overall picture is still firm, clearance rates landing in the mid-60s across both markets and ‘withdrawal adjusted’ rates a bit firmer still in the case of Sydney,” Westpac said on Friday.

“Daily price data is also coming in a bit firmer with prices about steady in both markets over the month to date compared to 0.3 to 0.9 per cent a month range over the previous three months.”

On Saturday, there was strong foot traffic at some open houses in Sydney’s inner west despite the cold. A tiny two-bedroom “quaint terrace” with a steep staircase on Gibbes Street in Newtown was standing room only. Its location among cafes and restaurants and affordable price guide at around $850,000 to $900,000 were its drawcards.

In Melbourne, 644 auctions were held compared to a 941 last year, Corelogic said. Sydney had 551 auctions compared to 641 auctions held at the same time last year.

Last week, the final national auction clearance rate was 61.8 per cent, the highest final clearance rate since May last year. Over the same week last year, the auction activity was higher with 1849 homes taken to auction, returning a clearance rate of 55.5 per cent.

The inner city areas of Sydney, including the eastern suburbs, were the best performers, while auctions in Parramatta in the west and Sutherland in the south didn’t do as well.

The same phenomenon was observed in Melbourne, with all inner city auctions selling well while weaker conditions prevailed in north east and outer east Melbourne and the Mornington Peninsula.

This article was originally published by the Australian Financial Review. Read the original here, or follow the AFR on on Facebook.

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