Auction clearances and volumes got a boost in the first week after the mid-year school holidays, lifting the traditionally quiet winter market.
The preliminary national clearance rate jumped to 74.8 per cent in the week to Saturday, up from the previous week’s final rate of 69.4 per cent as the number of auctions rose in most mainland capitals and the clearance rate gained in every city except Adelaide, where it was unchanged.
Melbourne led with a preliminary 79.4 per cent clearance rate – above last week’s 74.9 per cent – on the result of 676 auctions reported, CoreLogic figures showed. The total number of auctions scheduled for the weekend rose to 816 from 756 a week earlier.
In Sydney, the rate picked up by a similar margin to 74.9 per cent from 69.2 per cent a week earlier. The total 613 auctions scheduled were just over the previous week’s 609.
The closely-scrutinised two largest cities together account for 83 per cent of the national auction volume for the week. The latest figures strengthen the emerging picture of a market that is slowing, but doing so in a sustainable way, CoreLogic head of research Tim Lawless said on Sunday.
“It looks like in Sydney particularly, we’ve seen the marketplace has cooled and now it’s holding pretty firm at a level that’s still reasonably healthy,” Mr Lawless said.
“We’re seeing values rising, we’re seeing clearances rates close to 70 per cent. We’re still seeing relatively low numbers of listings. It looks like Sydney in particular has slowed down, but found a new base. In Melbourne, we’ve seen things have slowed down a little bit, but clearance rates tend to be holding firmer than Sydney. We can attribute that to the stronger affordability as well as high population growth.”
Earlier this month National Australia Bank cut its growth forecasts for both houses and units this year on the back of sharply deteriorating sentiment about the property market.
Figures from rival data provider Domain – owned by Fairfax Media, publisher of The Australian Financial Review – put Sydney’s Saturday clearance rate at 73.1 per cent, which Domain chief economist Andrew Wilson said showed a strengthening market.
“There’s a rebounding market in Sydney through winter, which is a little bit unusual,” Dr Wilson said. “The market has risen over four consecutive weeks.”
AMP Capital economist Shane Oliver said the Domain figures showed the Sydney market was still showing its weakest July since 2012.
Sydney’s auctions were centred around the more expensive and inner suburban areas, rather than outer areas more likely to have received a first home buyer boost from the cut in stamp duty that took effect this month. Northern Beaches had the highest clearance rate of 92.3 per cent, Eastern Suburbs 89.2 per cent and the City and Inner South region 78.3 per cent, CoreLogic figures showed.
In Marrickville, a three-bedroom, two-bathroom, two-car park renovated Federation house on 303 square metres sold $130,000 above reserve at $1.64 million on Saturday. Four parties bid for the 37 Kays Avenue East house that had a $1.51 million reserve, Belle Property Lane Cove agent Patrick Lang said.
“We love that it’s trendy to live in Marrickville now and it wasn’t when we moved in!” vendor Cheryl Williams said.
In Melbourne’s more widely-spread auction market, the strongest clearance rate came in the city’s North West region, where 90.1 per cent of the 71 reported auctions were successful.
“You’re seeing a strong level demand around the outer fringe areas where housing affordability is still pretty decent,” Mr Lawless said. “You can still buy property 20km from the Melbourne CBD for under $700,000, whereas in Sydney it’s very different.”
Brisbane’s preliminary clearance rate picked up to 50.6 per cent from 41.7 per cent a week earlier, CoreLogic figures showed. Adelaide held steady at 69 per cent. Perth picked up to 73.3 per cent – on the basis of just 15 auctions reported – from 46.2 per cent last week. Canberra clearances increased to a preliminary 73.3 per cent, up from 68.9 per cent.