The national preliminary auction clearance rate has remained robust, surpassing 70 per cent for the eighth consecutive week. As buyers anticipate a likely cut in interest rates later this month, the combined capital cities recorded a preliminary clearance rate of 72.3 per cent, according to data from Cotality. This figure represents a slight decrease from the previous week’s rate of 74.7 per cent.
In Sydney, 74.9 per cent of auctions were successful, marking the third-highest preliminary clearance rate for the year. Melbourne followed closely with a success rate of 71.8 per cent. Despite the typical slowdown associated with winter, the market’s resilience indicates a shift in buyer sentiment.
Market Dynamics and Future Outlook
Listing volumes have dipped in several markets; however, Louis Christopher, an analyst and founder of SQM Research, expects numbers to rise as the spring selling season approaches. He noted the market’s stronger position compared to the same time last year, highlighting a noticeable uptick in buyer sentiment, particularly in Sydney.
“The market is clearly stronger than where we were this time last year. We’ve noticed a further pick-up in sentiment in Sydney,” Christopher stated. He pointed out that the upper end of the market has shown more strength recently, with clearance rates in Sydney’s eastern suburbs outperforming those in the west.
As interest rates are anticipated to decrease, first-time buyers may become more active in the market. Recent inflation figures have contributed to expectations of continued rate cuts, which could further stimulate buyer activity. The headline Consumer Price Index (CPI) dropped to a four-year low of 2.1 per cent, setting the stage for the Reserve Bank board’s meeting on August 11-12, 2023.
Notable Auction Results and Regional Performance
Some significant auction results emerged in Sydney’s inner west. A two-bedroom, freestanding home located at 9 Petersham Street was sold for $1,978,000, significantly above its initial price guide of $1.5 million. The property garnered substantial interest, attracting more than 100 inspections and resulting in 17 registered bidders, with five actively competing. The auction was expedited by selling agents from Cobden Hayson, leading to a successful sale just 14 days after listing.
In smaller markets, Brisbane’s preliminary clearance rate remained steady above 70 per cent for the second consecutive week, reaching 71.1 per cent. In contrast, the ACT saw its success rate decrease to 65.8 per cent from 73.7 per cent the previous week, while Adelaide recorded a preliminary clearance rate of 65.1 per cent, the lowest since early June.
As the spring selling season nears, auction numbers are expected to stabilise, with approximately 1,570 homes scheduled to be auctioned in the coming week, increasing to around 1,900 the following week. This anticipated rise in activity reflects a broader trend of increasing buyer engagement in the property market.
Overall, the current auction landscape indicates a vibrant market with potential for growth as buyers respond to favourable economic conditions.
