Capital city auction conditions a lot stronger than this time last year

This week, a preliminary auction clearance rate of 72.8% was recorded across 1,494 auction results, with a total of 2,680 auctions held across the capital cities. Both auction clearance rates and auction volumes decreased last week, from 76.2% the previous week across 2,905 capital city auctions.

Currently, auction conditions are a lot stronger than they were at the same time last year. Over the corresponding week last year there were 1,983 properties taken to auction within the capital cities and RP Data recorded a clearance rate of 61.0%. It will be interesting to see if continuing high clearance rates encourage a further increase in the number of capital city properties taken to auction, given that current volumes are already so much higher than at the same time last year.

20140302 Capital city

Last week was Sydney’s second week this year where the number of auctions held in the city was more than 1,000. So far this year, Sydney’s auction clearance rate has been consistently recorded at or above 75%, which is much stronger than conditions seen at the start of last year. Last week, the preliminary auction clearance rate was recorded at 77.9%, with 1,019 properties taken to auction in the city. Over the previous week, there were 1,101 Sydney auctions and the final auction clearance rate was recorded at a strong 84.2%, the highest auction clearance rate seen in the city since September last year.

One year ago, there were only 751 Sydney auctions held over the week and the clearance rate was much lower, recorded at 61.1%. The increase in the number of properties taken to auction across the city demonstrates that vendors are becoming increasingly confident of a successful sale and are more willing to market their property under auction conditions.

20140302 Sydney

A preliminary auction clearance rate of 73.9% was reached from 1,319 auctions this week in Melbourne. This compares to 65.6% for the same time last year from fewer auctions.

This represents a substantial lift on the results a year ago and is a very strong result for the Melbourne market as it follows the highest volume of auctions for February on record.

Last month there were 2,623 auctions with a clearance rate of 71.5%. This was higher than the 2,571 recorded in 2010 although the clearance rate in February that year was 79.0%.

20140302 Melbourne

In Brisbane, less than half of all properties where RP Data recorded an auction result this week sold (42.4%), however, much like the other cities, there were more auctions held in the city this week (148) compared to the same week last year (111), when the clearance rate was recorded at a lower 37.7%. Over the previous week, Brisbane’s auction clearance rate was recorded at 63.6% with 161 properties taken to auction.

Although conditions across the Brisbane auction market are currently much weaker than across the larger auction markets of Sydney and Melbourne, it is important to remember than unlike Sydney and Melbourne, auctions account for a much smaller proportion of the overall Brisbane market.

20140302 Brisbane

Last week, Adelaide recorded a strong clearance rate of 75.0% with 97 auctions held in the city. Over the previous week, 118 Adelaide properties were taken to auction and RP Data recorded a final auction clearance rate of 59.8%. So far this year, Adelaide’s clearance rate has been recorded above the 70% mark, however prior to this, the clearance rate in Adelaide had not exceeded the 70% mark since back in September last year. The number of auctions held across the city over the same week last year was 70, with a clearance rate of 38.9%.

20140302 Adelaide

Auction volumes across the capital cities will be lower over the coming week due to multiple public holidays around the country. Currently, RP Data is expecting 1,402 auctions to be held across the capital city markets over the coming week.

Shana Miller is a research analyst at RP Data.

Melbourne auction commentary provided by Robert Larocca, RP Data’s Victorian housing market specialist

                      

Shana Miller

Shana Miller

Shana Miller is a research analyst with RP Data.

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