Sydney February auctions to test the always better than December precedent

Sydney February auctions to test the always better than December precedent
Sydney February auctions to test the always better than December precedent

February auction clearance rates are almost always much stronger than where December left off. But the extraordinary stock market turmoil we've seen so far this year has the potential to un-nerve the Sydney property market at least in the short term.

It is possible that the optimistic outlook that typically starts most years may not fully emerge - and even the wet deluge that dominated the holiday break could undermine the psyche necessary to secure a healthier auction start. Or at least delay listings given the odd jobs to spruce the home up for sale were put off.

We could be nervous and grumpy this February.

Ofcourse December auctions results didn't finish up that flash with a 53 per cent clearance rate.

The fatigued market saw the success rate fall over most of the spring selling season and then into early summer.

Last year February there was an 83 percent opening success rate which was well up on the December 2014 close of 69 per cent.

There have been even bigger rebounds in recent times as February 2013 had a 63 per cent success rate as against the 49 percent in December 2012.

Confident starts after the summer break are no guarantee that the year doesn't deteriorate into tougher market conditions.

And I think that will happen this year, with the early bird vendor getting the best offers before the predictable pre-Easter overload.

This is not to say 2016 won't be a healthy market. But we are not going to see prices skyrocketing month after month across all of Sydney.

We will even see in some suburbs where the inferior house down the street fetched a better price last year than the better home up for auction this year because the mood has shifted from crazy to cautious.

The RBA governor Glenn Stevens wasn't wrong in June last year when he suggested some crazy prices were being paid. 
 
After consecutive 15 percent plus price growth years, the Sydney housing market gained 11.5 percent during 2016, according to Core Logic RP Data
 
But Sydney was the weakest performer of any capital city, with dwelling values down by 2.3 percent during the December quarter. Houses at a $935,000 median and units at $676,000.
 
But home buyers are still substantially wealthier from housing in Sydney.

In dollar terms, Sydney home owners saw $82,000 added to their wealth during 2015. And $227,000 in the growth cycle since the end of the global financial crisis in early 2009.

When deciding just how to list your home this year, best ask your prospective listing agents not only how they went late last year but contrast their results against the overall suburban trend.

It was interesting to see CoreLogic RP Data note while Sydney’s auction clearance rate over the December quarter was 59 percent there were pockets of the Sydney market where clearance rate performance sits much stronger than the broader market.

For instance the eastern suburbs came in with the highest clearance rate at almost 75 percent, followed by the inner south and inner west at 67 percent. But Blacktown and Parramatta were in the low 40s.

BradfieldCleary director and auctioneer Bob Guth said that in his view the best time to market eastern suburbs real estate is February when there is less competition from other homes and apartments and this often leads to the best under-the-hammer results.

His eastern suburbs Sydney agency has its first eight auction scheduled for next week, so it will be interesting to see how they go.

This article was first published in the Saturday Daily Telegraph.

 

Jonathan Chancellor

Jonathan Chancellor

Jonathan Chancellor is one of our authors. Jonathan has been writing about property since the early 1980s and is editor-at-large of Property Observer.

Tags: 
Auctions Sydney

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