National Auction Market Stutters
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National Auction Market Stutters

Fewer listings and market distractions keep results stagnant.

By Terry Christodoulou
Mon, Mar 14, 2022 11:18amGrey Clock 2 min

The national auction market reported a clearance rate of 73.8% at the weekend – similar to the previous weekend’s 73.8% but well below the 85.3% recorded over the same weekend last year.

National auction numbers were lower at the weekend — with wild weather and Labour Day holidays driving the dip in numbers. The market saw 1585 homes listed for auction nationally compared to the 2377 of the previous weekend and well below the 1903 reported for the same Saturday last year.

Despite the meek showing, auction markets are set to return at full pace next weekend as regions recover from flooding and are free from holiday distractions.

The Sydney auction market recorded a clearance rate of 69.8% at the weekend – well below the 76.6% of the previous weekend and a stark comparison to the 90.6% recorded over the same weekend last year.

The NSW capital recorded 884 listings — which is up on the previous weekend’s 841 and well ahead of the 716 auctioned over the same weekend last year.

Sydney recorded a median price of $1,605,500 for houses sold at auction at the weekend – lower than the $1,915,000 reported over the previous weekend and 3.6% higher than the $1,550,000 recorded over the same weekend last year.

Melbourne’s market posted a clearance rate of 70.3% on Saturday – lower than last weekend’s 73.8% and remained well below the 81.5% recorded over the same weekend last year – a non-holiday weekend.

The Victorian capital reported 423 homes listed for auction, which is well down on the previous weekend’s 120 and significantly lower to last year’s non-holiday 9878 auctioned over the same weekend last year.

Melbourne recorded a median price of $1,008,000 for houses sold at auction at the weekend — lower than last weekend’s 1,170,000 but 2.9% higher than the $980,000 recorded over the same weekend last year.

Data powered by Dr Andrew Wilson, My Housing Market.

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House values continued to fall last month, but the pace of decline has slowed, CoreLogic reports.

In signs that the RBA’s aggressive approach to monetary policy is making an impact, CoreLogic’s Home Value Index reveals national dwelling values fell -1.0 percent in November, marking the smallest monthly decline since June.

The drop represents a -7.0 percent decline – or about $53,400 –  since the peak value recorded in April 2022. Research director at CoreLogic, Tim Lawless, said the Sydney and Melbourne markets are leading the way, with the capital cities experiencing the most significant falls. But it’s not all bad news for homeowners.

“Three months ago, Sydney housing values were falling at the monthly rate of -2.3 percent,” he said. “That has now reduced by a full percentage point to a decline of -1.3 percent in November.  In July, Melbourne home values were down -1.5 percent over the month, with the monthly decline almost halving last month to -0.8%.”

The rate of decline has also slowed in the smaller capitals, he said.  

“Potentially we are seeing the initial uncertainty around buying in a higher interest rate environment wearing off, while persistently low advertised stock levels have likely contributed to this trend towards smaller value falls,” Mr Lawless said. “However, it’s fair to say housing risk remains skewed to the downside while interest rates are still rising and household balance sheets become more thinly stretched.” 

The RBA has raised the cash rate from 0.10 in April  to 2.85 in November. The board is due to meet again next week, with most experts still predicting a further increase in the cash rate of 25 basis points despite the fall in house values.

Mr Lawless said if interest rates continue to increase, there is potential for declines to ‘reaccelerate’.

“Next year will be a particular test of serviceability and housing market stability, as the record-low fixed rate terms secured in 2021 start to expire,” Mr Lawless said.

Statistics released by the Australian Bureau of Statistics this week also reveal a slowdown in the rate of inflation last month, as higher mortgage repayments and cost of living pressures bite into household budgets.

However, ABS data reveals ongoing labour shortages and high levels of construction continues to fuel higher prices for new housing, although the rate of price growth eased in September and October. 

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