The Australian property market has been buzzing with activity as we approach the end of the year. Despite the spring season coming to a close, last week's auction numbers remained relatively high, indicating that vendors have been quite active. However, buyers have become more cautious, leading to a slight dip in the clearance rate across the combined capitals.
Auction Numbers and Clearance Rates
In the previous week, a total of 2,918 homes were auctioned across the combined capitals, showing a 4.1% decrease compared to the previous week. Although this figure is lower, it is still 25.8% higher than the same period last year, indicating the increased vendor activity this spring.
However, despite the resilience in auction activity, the combined capital preliminary clearance rate dropped by 10 basis points, settling at 66.8%. It is worth noting that the final clearance rate for the previous week, which initially stood at 66.9%, dropped to 57.6%—a clear deviation from the average final clearance rate of 65.8% recorded throughout winter and spring.
State Highlights
Sydney
In Sydney, the number of homes auctioned dipped below the 1,000 mark for the first time in eight weeks. With 958 homes auctioned, this figure was 10.6% lower than the previous week but 21.6% higher compared to the same period last year. The preliminary clearance rate in Sydney was recorded at 65.5%, the lowest rate observed throughout the year.
Melbourne
Melbourne hosted 1,401 auctions, slightly lower than the previous week. However, this number was significantly higher compared to the same period last year. With a preliminary clearance rate of 66.9%, Melbourne recorded its highest rate in four weeks. Although this is below the average level recorded throughout the spring, it surpasses the final rate from the same period last year.
Adelaide and Canberra
Adelaide concluded the year on a high note, hosting nearly 200 homes auctioned—its busiest auction week of the year. The preliminary clearance rate in Adelaide saw a 1.0 percentage point rise, with 81.7% of auctions reporting a successful result. Canberra also experienced a rise in both auction numbers and preliminary clearance rate, with 65.9% of the 143 auctions returning positive results.
Brisbane, Perth, and Tasmania
On the other hand, Brisbane observed a decline in both auction numbers and early success rate week-on-week. Brisbane hosted 186 auctions, with an early success rate of 56.3%. In Perth, seven out of nine auctions were successful, while Tasmania saw three out of four auctions achieving successful results.
Rental Markets
As we wrap up the spring and early summer selling auction season, buyers have benefitted from increased options, reduced urgency, and more leverage during negotiations due to higher advertised supply levels. Although auction numbers are expected to remain subdued in December and early January, the diverse conditions witnessed across different cities in the final month of the year set the stage for 2024.
Caption: Capital City Auction Statistics
Source: CoreLogic
Conclusion
The Australian property market continues to showcase its resilience, with increased vendor activity and steady auction numbers. However, buyer caution has led to a slight decline in the clearance rate. As we move into the new year, it will be interesting to see how the property market evolves and whether the trends witnessed this year will continue.
Note: The data presented in this article is accurate as of December 19th, 2023.
