Unprecedented Weekend Auction Results
Beyond the majors, Adelaide claims close to 100 per cent clearance rate.
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Following last weekend’s bumper results, Saturday, March 6 produced more impressive returns with each capital city recording a weekend auction clearance rates above 80%.
The unprecedented result saw Adelaide (97.1%) and Brisbane (close to 90%) as standout markets.
Sydney, meanwhile, reported a rate of 86.8% – down on last weekend’s record-breaking 90.0%, but up on the 90.5% reported over the same weekend last year.
The median price for houses sold at auction in Sydney was $1,704,000, higher than the previous weekend’s $1,645,500 and 17.5% above the $1,450,000 recoded over the same weekend last year.
The upper north shore reported the top clearance rate results at 90.8%.
Despite being a holiday weekend, Melbourne posted another strong Saturday with a rate of 80.6% – slightly lower than the previous weekend (82.0%) but well ahead of the 71.9% reported for the same period last year.
Melbourne recorded a median price of $948,000 for auctioned houses, lower than the previous weekend’s $1,002,500 Prices however were 10.9% higher than the $855,000 recorded over the same holiday weekend last year.
Data powered by Dr Andrew Wilson of MyHousingMarket.com.au
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Mortgage holders should brace themselves for more pain as the Reserve Bank of Australia board prepares to meet tomorrow for the first time this year.
Most economists and the major banks are predicting a rise of 25 basis points will be announced, although the Commonwealth Bank suggests that the RBA may take the unusual step of a 40 basis point rise to bring the interest rate up to a more conventional 3.5 percent. This would allow the RBA to step back from further rate rises for the next few months as it assesses the impact of tightening monetary policy on the economy.
The decision by the RBA board to make consecutive rate rises since April last year is an attempt to wrestle inflation down to a more manageable 3 or 4 percent. The Australian Bureau of Statistics reports that the inflation rate rose to 7.8 percent over the December quarter, the highest it has been since 1990, reflected in higher prices for food, fuel and construction.
Higher interest rates have coincided with falling home values, which Ray White chief economist Nerida Conisbee says are down 6.1 percent in capital cities since peaking in March 2022. The pain has been greatest in Sydney, where prices have dropped 10.8 percent since February last year. Melbourne and Canberra recorded similar, albeit smaller falls, while capitals like Adelaide, which saw property prices fall 1.8 percent, are less affected.
Although prices may continue to decline, Ms Conisbee (below) said there are signs the pace is slowing and that inflation has peaked.
“December inflation came in at 7.8 per cent with construction, travel and electricity costs being the biggest drivers. It is likely that we are now at peak,” Ms Conisbee said.
“Many of the drivers of high prices are starting to be resolved. Shipping costs are now down almost 90 per cent from their October 2021 peak (as measured by the Baltic Dry Index), while crude oil prices have almost halved from March 2022. China is back open and international migration has started up again.
“Even construction costs look like they are close to plateau. Importantly, US inflation has pulled back from its peak of 9.1 per cent in June to 6.5 per cent in December, with many of the drivers of inflation in this country similar to Australia.”
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