Auction clearances sink under listings flood

This weekend marked the second biggest weekend of auctions since CoreLogic began tracking the market in 2008, with a whopping 4136 homes going under the hammer.

Australia’s preliminary auction clearance rate fell further to 69.9% from 71.4% last weekend – a figure that will likely fall into the mid 60s once all results are counted:

According to CoreLogic:

There were 4,136 homes taken to auction across the combined capital cities this week making it the second busiest week for auctions since CoreLogic records commenced in 2008, down slightly from the previous week when 4,251 auctions were held… There have been 3,402 results collected so far this week, returning a preliminary auction clearance rate of 69.9 per cent, down from the previous week’s preliminary
clearance rate of 71.4 per cent, which revised down to a final clearance rate of 68.5 per cent…

There were 1,889 homes taken to auction in Melbourne this week, the third busiest week for auctions this year… Of the 1,558 results collected so far, 69.4 per cent were successful, up from the previous week when a preliminary clearance rate of 68.5 per cent was recorded, revising down to 66.3 per cent at final figures…

This week was the second busiest auction week for Sydney so far this year, with 1,467 homes taken to auction across the city, down from 1,546 over the previous week…

Of the 1,249 results collected so far, 67.3 per cent have been successful, the first time the city has seen the preliminary clearance rate slip below 70.0 per cent since early September 2020. The previous week saw a higher preliminary clearance rate of 71.4 per cent, revising down to 67.2 per cent at final figures, the lowest final clearance rate the city has seen all year.

The national clearance rate has fallen sharply from recent peaks:

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

The next logical step is for price growth to moderate.

Unconventional Economist
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