Auction market takes a breather

After last week’s final auction clearance rate hit a two-year high,¬†CoreLogic’s preliminary auction clearance rate for the weekend’s auctions retraced slightly, although Sydney’s and Melbourne’s remained well above 70%:

Auction volumes also remain soft – 1,100 aucti0ns were held over the weekend versus 1,324 in the same weekend last year:

According to CoreLogic:

Despite the lower weighted average result this week, Melbourne and Sydney returned a preliminary clearance rate above 70 per cent for another week.

There were 500 Melbourne homes taken to auction this week, 73.3 per cent of which returned a successful result, up on the 71.7 per cent final auction clearance last week when volumes were higher (544).

Volumes were relatively steady across Sydney this week, however the city returned a lower week-on-week clearance rate. There were 381 homes taken to auction this week, returning a preliminary auction clearance rate of 74.8 per cent, lower than the 75.7 per cent final clearance rate the week prior when 394 auctions took place.

Domain’s preliminary auction results were similar, albeit on softer volumes:

When the final results come in on Thursday, the national clearance rate will likely fall into the mid–60s, whereas both Sydney’s and Melbourne’s will likely fall to around 70%.

While the strong bounce in clearance rates is pointing to prices rebounding strongly, it is likely to be muted given the low volumes, the ongoing lack of available credit, and the deteriorating economy:

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