Spring auctions could slump into the 30s

Spring auctions could slump into the 30s
Jonathan ChancellorDecember 8, 2020

A turreted beachfront terrace on Port Phillip Bay topped the nation's weekend auction sales, as clearance rates tumbled across the capital cities.

Sydney's weekend clearance rate dropped to 44 percent according to Domain, with Melbourne not faring too much better at 48 percent.

The deterioration had market watchers anticipate auction clearance rates dipping into the 30s. 

SQM's Louis Christopher noted three previous times when Sydney auction clearance rates sunk into the 30s.

"That was in October/November 2008 during the GFC, May 2004 after the NSW vendor stamp duty was introduced and July 1989 when the cash rate hit 17 percent."

Domain chief analyst Nicola Powell said the trend suggested there would not be any improvement before the year is out.

"I think this is what we are going to see for Sydney for the rest of the year," she told Fairfax Media.

Dr Andrew Wilson at My Housing Market advised the marketed had "plunged to new depths" on Saturday in the toughest market conditions since the economic shock of the GFC.

"A rising crisis of confidence is now gripping markets with buyer and seller wariness," he noted.

CoreLogic noted there had been increase in auction volumes with 2,119 homes taken to auction across the capital cities, up from 1,851 over the previous week.

But it was still lower than the same time last year when 2,519 auctions were listed.

Preliminary CoreLogic results showed a clearance rate of 49.8 per cent across the capital cities, considerably lower than the 64.7 percent in mid-october last year.

"It marked the fourth consecutive week where the clearance rate has been below 50 per cent," Kevin Brogan noted.

Melbourne was host to 1,088 auctions.

The most expensive home sold in Melbourne was a four-bedroom terrace house with rooftop turrets at 213 Beaconsfield Parade, Middle Park (top) for $5.3 million after a $5.1 million opening vendor bid which was matched by a bidder.

Two other parties had flagged interest, but chose not to bid, and, after post auction negotiations, the sole bidder raised the offer by $200,000.

The iconic beachfront home has a distinct heritage facade with a castle-like top providing the crowning glory to the traditional terrace.

There was only one bidder for the restored Victorian era residence with a contemporary B.E Architecture update on its 319 sqm lot.

There had been $5 million to $5.5 million price guidance of the once once owned in the early 1990s by the IVF pioneer Professor Carl Wood who had paid $465,000 in 1990.

St Clair (below), a landmark 1934 Eaglemont offering did not sell.

Spring auctions could slump into the 30s

The lofty 2261-square-metre offering atop Mount Eagle now comes with a $3.9 million asking price through Nelson Alexander agent Gordon Hope who had initial $3.8 million to $4 million price guidance.

The house at 33-35 Mount Street last sold in 1994 at $620,000.

In the race to auction pre-Cup Day, the Real Estate Institute of Victoria are expecting more than 1600 homes on Saturday, including the five apartment in The Block Gatwick renovation in St Kilda. 

There were 659 auctions held in Sydney on the weekend.

"It is interesting to note that fewer Sydney properties sold prior to auction," CoreLogic's Kevin Brogan said, reflecting on "the softening market."

Sydney's highest sale was 19 Bannockburn Road, Pymble (below), which sold for $3.35 million.

Spring auctions could slump into the 30s

The 1940s house had been extended and renovated over the years into a single level four bedroom, three bathroom offering.

The nation's cheapest result was $105,000 for a three bedroom house in Adelaide, according to Domain.

The 6 Redcliff Street, Davoren Park offering was a mortgagee sale.

It had sold at $105,000 in 2007.

In 2013 it was a $210 a week rental.

Jonathan Chancellor

Jonathan Chancellor is one of Australia's most respected property journalists, having been at the top of the game since the early 1980s. Jonathan co-founded the property industry website Property Observer and has written for national and international publications.

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