Last weekend, there was talk that the housing correction may be stabilising after the national auction clearance rate rose to a 19-week high of 52.6%.
That belief was shattered this weekend, with Cotality’s preliminary auction results reporting a sharp retracement, with the preliminary clearance rate falling by 4.6% to 54.0% across the combined capital cities.
The fall in clearances came as auction volume rose 15.6% over the week, alongside worsening interest rate expectations ahead of the Reserve Bank’s 29 September monetary policy board meeting.
Source: Cotality
This was the sixth week in a row where the volume of auctions held has been more than 30% below levels recorded a year ago, highlighting a combination of fewer new listings coming to market through spring and also fewer vendors choosing to sell by auction as clearance rates hold low and registered bidders remain scarce.
Melbourne’s preliminary clearance rate plunged 7.0% to 56.3%, the lowest result in three weeks.
Sydney’s preliminary clearance rate fell by 5.4% to 54.2%, marking the lowest preliminary result in seven weeks.
Brisbane recorded a 3.0% rise in auction volume compared with a week ago. However, only 37.5% of auctions reported a successful result, down 4.1% from last week.
Meanwhile, the nation’s house price correction continues in earnest, with values declining by 1.3% over the month across the five major capital city markets, with each recording falls of 1.0% or more:
The quarterly pace of decline remains sharp at 3.9% across the five major capital city markets, with each market recording significant falls:
There are currently no signs that the housing correction is easing. And with the Reserve Bank forecast to increase rates two to three more times, the downturn could yet accelerate.
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