Auction numbers swells as spring approaches

Auction numbers have surged off the back of a strong market since the start of 2014, with 42% more homes sold under the hammer compared to this time last year, according to RP Data.

Not including this week, there have been 36,608 homes sold at auction across Australia, compared to 25,623 last year.

But demand is still meeting supply, as the national clearance rate lifts back up to 68.4% off 1544 auctions, despite a slight dip last week.

RP Data Victorian housing market specialist Robert Larocca told SmartCompany increased auction volumes were partly due to a general market improvement, but primarily due to a swell in the number of auctions throughout Sydney.

Australia’s biggest city scored a strong 76.7% clearance rate off 562 auctions at the weekend.

Larocca says a number of local home owners who traditionally would have shied away from selling their properties under the hammer, now have the confidence to go to auction.

“It looks like, for the first time, there’s a shift towards the auction sales method,” says Larocca.

“There have always been auctions in Sydney, but they have mostly played second rung to Melbourne.

Larocca says nationally, however, over the last 12 months there has been a higher proportion of residential sales via auctions.

“Auctions work well with a competitive market place,” he says.

“Given the clearance rates, it’s clear that decision by agents and vendors to go to auction is paying off.”

Larocca says there has been a 30% increase in the number of properties sold at auction in Melbourne compared to the same time last year, echoing the strong market.

This week, Melbourne had a clearance of 67.7% as 719 properties faced the auction block.

Brisbane had a better week, with 50% clearance on 98 homes, while Adelaide was solid at 69.2% off 71 properties.

We can expect a gradual building of stock numbers as we head into spring, according to Larocca.

Melbourne, the country’s largest auction market, is expecting to hit auction numbers at around 800-900 in the coming weeks, while Sydney is expected to sit just slightly below those figures.

Larocca say clearance rates indicate a positive outlook for vendors, with plenty of buyers still in the market.

This article first appeared on SmartCompany.