Volumes continue to be low but clearance rate rises: Weekend auction preview

The trend of lower auction volumes in 2015 continues with 29% fewer homes on offer across capital cities this week.

The low volumes appear to have contributed to strong rises in the clearance rate last week in both Sydney and Melbourne.

There are 2,497 auctions expected this week across Australia with 2,058 expected in capital cities. This is compared 1,541 last week and 2,905 for the same week last year.

In Sydney 775 auctions are expected compared to 662 last week and 1,101 this week last year. The clearance rate last week was the highest in a year and should encourage a few more vendors to list for sale as there is clearly strong demand from buyers.

In Melbourne 936 auctions are expected compared to 584 last week and 1,401 this week last year. The 10-point rise in the clearance rate last week is a sign of a healthy market and provides an indication that the interest rate cut has been welcomed by buyers.

There are 101 auctions expected in Brisbane compared to 118 last week and 161 this week last year.

This week there are 124 auctions expected in Adelaide compared to 91 last week and 118 on the same week last year.

In Canberra there are 77 auctions expected compared to 49 last week and 65 this week last year.

In Perth 30 auctions are expected compared to 26 last week and 49 this week last year.

Across Australia the highest volume of auctions in one suburb are 20 in Richmond (Vic). Of the 2,497 homes being auctioned 936 are listed as three bedrooms, 666 as four bedrooms and only 162 with five bedrooms.

Melbourne auction preview

There are 936 auctions scheduled this week in Melbourne compared to 1,401 for the same time last year. The highest volume of auctions will be in Richmond with 20 scheduled. There are 17 in Bentleigh East and St Kilda.

The Melbourne auction market is sending mixed messages at the moment, on one hand the clearance rate has risen to be closer to the trend rate for last year, when it was 68.2%. In contrast volumes are low suggesting that potential vendors are lacking the confidence shown last year.

It is also possible that vendors and their real estate agents are choosing private sale instead of auction as a method of sale. It won’t however be possible to ascertain if that is happening for a few months.

In respect of the private sale market in the past week, on a citywide basis, the time on market results for houses sold at private sale was 66 days, slightly up from 65 days in the previous week. Overall vendor discounting was up slightly to -5.2% from -5.1%.

Key data

• Clearance rate week ending 15 February: 70.9%
• Melbourne auctions expected week ending 22 February: 936
• Melbourne private sales time on market week ending 15 February: 65 days (houses)
• Melbourne vendor discounting market week ending 15 February: -5.2% (houses)
• Listings being prepared for market are 3.5% lower in the month ending 15 February (seasonally adjusted)