Auctions deluge drowns clearance rates

This weekend marked the biggest weekend of auctions since CoreLogic began tracking the market in 2008, with a whopping 4261 homes going under the hammer:

Accordingly, Australia’s preliminary auction clearance rate fell to 71.4% – a figure that will likely fall into the high 60s once all results are counted:

According to CoreLogic:

This week saw Canberra, Adelaide and the combined capital cities all recording their busiest auction weeks since CoreLogic records commenced in 2008. Across the combined capitals 4,261 homes went under the hammer, marking the first time the volume of capital city auctions has exceeded 4,000…

Demand hasn’t quite kept pace with the surge in auctions held, with the preliminary clearance rate continuing the softening trend evident since early October, slipping further this week, with 71.4% of the 3,471 results collected so far selling before, at or after auction.

Melbourne recorded its busiest week since late March and its lowest preliminary clearance rate since the middle of September…

Originally predicted to break its all-time record, Sydney disappointed this week, with 5% of scheduled actions postponed, likely due to the weather. With 1,577 homes taken to auction across the city, this week was Sydney’s second busiest on record and the busiest since late November 2014 when 1,631 homes went under the hammer… With 1,281 results collected so far, Sydney reported a preliminary clearance rate of 71.4% – its lowest reading over the year-to-date…

The national clearance rate has fallen sharply from recent peaks; albeit remains at a solid level historically:

The above is indicative of a slowing market. While buyer demand remains strong, a record number of sellers are seeking to cash in on the record prices while they can. Hence, supply is begin to overrun demand.

Unconventional Economist

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