With the auction process more popular than ever, a new report has identified five key factors that drive success on auction day.
The latest Domain, In Focus: Auctions shows that factors including the month or day of the week, a property’s location and attributes, as well as overall investment activity, should be taken into account when considering whether to auction a property.
The report notes that when looking at the day of the week to auction a property the traditional Saturday auction is still the best performer.
While midweek auctions are catching up, Saturday auctions still perform best, followed by Sunday, Thursday and Wednesday.
“The traditional weekend auction has consistently provided a higher median house price, while it’s the reverse for units,” the report said.
“The price difference between midweek and weekend auctions has significantly decreased.
“The narrowing price differential is another data point that suggests midweek auctions are perhaps becoming more mainstream.
“Midweek auctions have also seen greatest improvement in clearance rates and are starting to rival prices achieved on a weekend.”
The state the auction is taking place in as well as the location are also important considerations, according to Domain.
The traditional auction markets in Sydney lead the way with locations such as the Eastern Suburbs, City, Inner West and Inner South West all top performing auction markets.
However, Domain notes that they are now seeing auctions cascade into middle and outer suburbs.
Other leading auction locations include Central and Hills in Adelaide, Adelaide South, Canberra and the Outer and Inner East in Melbourne.
In terms of the time of year, February is the best time to sell and January is the worst, while all other months are relatively equal.
Domain also found that houses with two bedrooms and one bath are more likely to sell in the current market, with houses overall also more likely to sell at auction.
The other important consideration is the role of investors.
As investors typically buy in a market upswing, properties are more likely to sell at auction as the value of home loans to investors increases.
Domain Chief Revenue Officer, John Foong said sellers can use this information to determine the best auction strategy and if it is the best sales option.
“By pairing the knowledge and expertise of real estate professionals and auctioneers with the model that Domain has created using 20 years worth of auction data, sellers will be in such a strong position to maximise chances of success at auction,” Mr Foong said.
“From advising on the day, month or season to go under the hammer, to providing guidance based on the state you are operating in, we hope that these five supercharging factors are a valuable resource for agents across the country.”
Previous reports in the auction series found that the proportion of sales by auction has almost doubled over the past 10 years.
Sydney, Melbourne and Canberra continue to dominate, but sales have been rising in smaller auction markets.