Rising clearance rates reflect post-election confidence bounce

In Melbourne, a preliminary auction clearance rate of 62.9 per cent was recorded across 971 auctions, while the prior weekend saw 432 auctions returning a final clearance rate of 60.7 per cent. This time last year, 1132 auctions were held across the city, returning a clearance rate of 59 per cent.

The nation’s top weekend sale was in pricey Bellevue Hill. The $5.625 million sale was a six-bedroom home on 658 square metres at 12 Arthur Street through McGrath.

weekend property wrap
The home last sold almost four years ago for $5.15 million. Photo: McGrath Real Estate

 

It last sold for $5.15 million in September 2015.

There were 697 auctions held in Sydney, returning a preliminary clearance rate of 69.9 per cent. In comparison, there were just 276 auctions held over the previous week returning a final clearance rate of 56.5 per cent.

“There is a chance that this week’s final clearance rate may just be able to hold above 60 per cent after Sydney has seen the final clearance rate sit above 55 per cent for the last three weeks,” CoreLogic auction analyst Kevin Brogan said.

There was a big number of sold-before results in Sydney, totalling 140 properties. One year ago, 814 auctions were held across Sydney, and the clearance rate came in at 56.1 per cent.

There were 2041 homes taken to auction across the combined capital cities after the previous week saw volumes drop to 930, likely due to the federal election. This time last year, volumes were higher with 2297 auctions held, according to CoreLogic. Preliminary results show a national clearance rate of 62.6 per cent across the combined capital cities.

Last week’s final clearance rate came in at 55.2 per cent, the highest clearance rate we have seen since September.

“It’s possible that this week’s final clearance rate may top that as remaining results roll in,” Mr Brogan said.

Over the same week last year the final clearance rate was recorded at 56.2 per cent.

“Clearance rates have bounced back and overall the results are consistent with the narrative that confidence is returning to the market after the federal election result,” Mr Brogan noted.

“Stimulatory factors include the continuity in negative gearing and capital gains tax concessions for investors, potential changes to the APRA home loan serviceability buffer and the prospect of imminent reductions in interest rates,” he said.

Looking at the smaller auction markets, auction volumes increased week on week across all capital cities. Preliminary results show that clearance rates were down slightly over the week in Brisbane, while all other cities saw an increase week on week.

The cheapest sale was $135,000 in Adelaide in a mortgagee sale through Ray White. The three-bedroom house at 4 Benham St, Elizabeth East had sold at $150,000 in 2009 when offloaded by the SA Housing Trust. It was marketed as a maisonette on 653 square metres and it came with solar panels and there were security roller shutters on all main windows.

Jonathan Chancellor is editor at large at Property Observer

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