“The market is in a frenzy, it creates uncertainty because the price is moving very quickly”…
The national auction clearance rate rose again over the weekend, continuing the strongest run of results for six years.
The preliminary national clearance rate was 78.9%, up from the 78.4% recorded last weekend, according to Core Logic-RP Data:
Sydney’s clearance rate retraced 0.4% to 86.5%, as did Melbourne’s, which fell 1.7% to 78.3%. Clearances in Brisbane, which typically only has a small number of auctions, were 51.2%, which was the same as last weekend. Overall auction volumes (2,727) were also up on the 2,470 auctions recorded last weekend:
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As shown in the next chart, Melbourne auction clearances are locked at a high level, up 12.9% over the year:
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Sydney’s clearance rate also remains in the stratosphere, up 13.5% over the year:
In describing the red hot Sydney market, SQM Research’s Louis Christopher did not mince words:
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“There is broad knowledge that prices have rapidly risen. In Sydney there is general consensus that the market is abnormally strong right now.
“Many would-be sellers are holding back, thinking they are going to get a higher price. But they are fearful if they can’t buy back into the market they will lose some potential gains.
“Buyers are very fearful they may be buying close to the top, and they’d be fully aware they are paying top dollar, but their fear is the market could go even further up.
“Our indicators suggest that is exactly what it’s going to do. There is a lot fear, there is a lot of greed out there right now. There’s a degree of uncertainty in terms of exactly where valuation is.”
It’s called a speculative bubble, Louis.
