Auction clearance rates dip on lower volumes

By Leith van Onselen

Auction clearance rates fell slightly in Australia’s two largest markets, with the number of auctions held down significantly on last weekend’s “Super Saturday” volumes.

In New South Wales, a preliminary auction clearance rate of 60% was recorded from 563 auctions reported to the Real Estate Institute of New South Wales (REINSW). This compares to a provisional clearance rate of 62% recorded last weekend on 603 auctions. The number of homes auctioned was also below the same weekend of last year when 610 homes went under the hammer.

In Victoria, only 160 auctions were scheduled (the Derby Day effect) to take place over the weekend – a big step down from the 1,180 auctions scheduled on “Super Saturday” and the 580 auctions held on the same weekend of 2011. The REIV recorded a provisional clearance rate of 62% on the 163 auctions reported to the Institute. This compares to a provisional clearance rate of 66% recorded last weekend on 1,053 auctions, which was later revised down to 64% once late results were captured, and the 50% clearance rate recorded this time last year.

So overall, another solid yet unspectacular result was recorded over the weekend, with auctions recording clearance rates well above last year’s depressed levels, but well under the 70% to 85% clearance rates common during the boom times.

Twitter: Leith van Onselen. Leith is the Chief Economist of Macro Investor, Australia’s independent investment newsletter covering trades, stocks, property and yield. Click for a free 21 day trial.


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  1. “Derby Day Effect” — isn’t Derby Day on the same day (i.e., 1st Saturday in November) every year?

    In which case it’s really strange to see only 163 reported auctions (VIC), down from 580 last year. Also high numbers being passed in (would be interesting to see how many rec’d no bids)

    Either way, it seems really bizarre that such a low volume would have been planned, given the crazy volumes last weekend (which in itself doesn’t make a great deal of sense…presumably spreading the buyers a bit thin on the ground)

    This is what you get from removing “Supply & Demand 101” from the Real Estate agent’s handbook

      • Mining BoganMEMBER

        My neighbour used to go through my garbage and take stuff for his garage sales.

        Just because it’s rubbish doesn’t mean everyone thinks so.

          • Mining BoganMEMBER

            My neighbour thanked mt too. I think his ‘garage sale’ every weekend for a year was actually a sly second-hand shop run from the carport.

            Is that the ‘small business’ everyone on here keeps banging on about? My cast-offs are the economy?


      • I think that the REIV’s “data” is completely corrupted, but figure that comparing this year’s corrupt data with last year’s corrupt data should hopefully provide some kind of “feel” for what is going on…

        It’s all about “the vibe”…

        • reusachtigeMEMBER

          I see where you are coming from, and I used to see it that way, but I think the corrupted data has become even moreso corrupted, much moreso. The old corrupted data was still painting too gloomy a picture so needed more corrupting so as to brighten things up, just a tad.

  2. how can someone take this seriously when the unreported numbers are getting close to 25% of the total numbers?

    • Agreed, it would be a lot more accurate to say something like –

      “Victoria: 62% based on reported.
      Could actually be somewhere in the range of

      As people have said on here before though, I agree its not a particularly good metric anyway. It doesn’t really show property strength or weakness, just how much overlap there is buyers vendors and buyers expectations i.e. if all sellers suddenly reduced their prices by half, you might see a clearance rate much closer to 100% but you wouldn’t exactly call it good for the existing property holders.

      • It’s one of the few Macrobusiness articles that is undercooked. Commenters have made this point repeatedly, so why do MB keep ignoring the unreported auctions? They should be tallied and mentioned as part of this analysis.

        • Agree. I have consulted the tea leaves and have forseen a future “van Onselen-Vedelago Index” which removes the corrupt influences of the property sector from the reporting of key data and:

          – removes sales before auction in the calculation;
          – removes sales after auction from the calculation;
          – includes properties withdrawn as failed auctions; and
          – provides revised auction figures at a later date which revises (downwards) auction figures so that all unreported results are concluded as FAILURES, which is no doubt the case in 99% of cases

          Consequently, the ‘van Onselen-Vedelago Index’ will calculate true auction rates some 10 – 15% lower than the contrived propaganda we are currently served up, meaning that the magical psychological barrier of sub 50% auctions will be breached – indicating the pulse of the market is well and truely screwed.

          So, how about it? I agree that reporting these REIV stats etc wholesale without this analysis is pandering to the property sector vested interests who wish to hide the true and dismal state of the market.

          MB is better than this.

    • Part of the problem in Melbourne is there are Sunday Auctions are not reported until Tuesday. About 10% of all auctions are on Sunday with a large number in the inner south area which has a large religious jewish population; hence Sunday as opposed to Saturday auctions.

  3. Regardless of the methodology you can bet that agents will be doing all they can to inflate the clearance figures as much as possible to point to a rosy, healthy industry (so keep piling in or miss out!).

    I spoke to someone the other day who had been conned by ‘investment advice’ given to them by a Real Estate Agent about five years ago that property in a certain country locale was going to go through the roof… the agent had ‘inside’ information. It never happened and the purchaser was left with an overpriced property in an undesirable location they had to subsequently sell at a loss.

    In my opinion the sooner that agents are regulated to prevent them giving out ‘financial advice’ the better.

    • Mining BoganMEMBER

      I suspect the regulation will come in after TSHTF.

      Mum and Dad losing money on investments? Someone must have lied! Call ACA! Stat!

      It will become known as the Grimshaw Statute.

      • That made me laugh! Yeah, call the police – someone lost some money. Tracey Grimshaw will expose them in a story with lots of shaky camera work chasing RE agents down the street …