Auction action: What happened over the weekend and what’s in store for 2023

Auctions are back after the summer holiday break, although activity remains subdued in Australia’s major cities.

We take a look at the headline numbers over the weekend and see what the experts had to say.

The clearance rates

Domain 60.3%64.4%57.5%N/AN/AN/AN/AN/A
Ray White71%N/AN/AN/AN/AN/AN/AN/A
Preliminary clearance rates. Domain data for Saturday 28/1. CoreLogic data for week ending 29/1.

There were 706 homes taken to auction across the combined capital cities last week, according to CoreLogic.

That’s 180.2 per cent higher than the previous week (252), although 39.5 per cent lower than the same week last year when auction activity picked up earlier than usual (with 1166 going under the hammer).

There were 259 homes taken to auction in Melbourne and 202 homes in Sydney.

Adelaide saw 105 homes go under the hammer, Brisbane 98 and Canberra 36.

Perth and Tasmania saw just three auctions each (not enough to publish a clearance rate).

An update from the Gold Coast

The Gold Coast was the centre of much of the weekend’s auction action after Ray White Burleigh Group, Ray White Broadbeach, and Ray White Robina teamed up to hold their Summer Auction event.

Held at The Star, the event saw $24.4 million worth of properties go under the hammer, according to Ray White.

There were 42 auctions scheduled for the day, with the top sale of the day going to 28 Arthur Street, Mermaid Beach, which sold for $2.7 million – $450,000 over reserve.

Funds from the sale of 28 Arthur Street were directed to the RSPCA on the request of the property’s late owner.

There were 59 registered bidders, 45 of whom were active on the day, according to Ray White.

Ray White did not report a final clearance rate on the day but it is understood more than 50 per cent of properties were sold.

Ray White Burleigh Group Director Tiger Malan said the success of auctions throughout the event was product dependent. 

“Anything near water we had really good activity, but some of the investor stock was a bit tighter,” he said. 

“For certain properties, the hum was like it was six months ago, and then you’d have a product with no bidding. 

“There are some property types where I think prices will keep running, and other products which will see a downturn.” 

Around 66 per cent of buyers being owner-occupiers, while the other 34 per cent were investors. 

A total of 71 per cent of buyers were locals while 29 per cent were from interstate.

What the socials said

What’s in store for 2023?

CoreLogic Research Director Tim Lawless said that while auction clearance rates had been trending lower in 2022, there were some signs of recovery during the December quarter.

Despite this, 2023’s auction market was more likely to start with a “whimper rather than a bang”, according to CoreLogic’s latest update.

The most recent Quarterly Auction Market Review shows 25,637 properties went under the hammer across the combined capitals with a clearance rate of 57.8 per cent in the December quarter.

That was up slightly on September’s quarterly figures of 23,087 auctions and a 56.4 per cent clearance rate, but still well below the decade average of 65 per cent.

“Auction volumes were well below the numbers seen only 12 months ago, when a record breaking 42,918 homes were taken to auction across the combined capitals over the December 2021 quarter, the busiest quarter since CoreLogic auction records commenced in 2008,” Mr Lawless said.

“The clearance rate during that time was also significantly higher at 71.3 per cent, which reflects the feverish buyer activity in late 2021 given the record low interest rate environment, tight stock levels and rapidly rising housing prices.”

Mr Lawless said the below average clearance rates were accompanied by a trend towards fewer home sales. 

“Over the past two decades during each of the downturns, we’ve seen the volume of home sales drop by about 25 per cent, which is remarkable given every downturn has been different,” he said.

“The trend in home sales through the current downturn is likely to be similar, with annual sales already down an estimated 17 per cent from the December 2021 peak.

“Private treaty metrics are showing a similar trend to the auction market, with homes taking longer to sell and vendors applying larger discounts.”

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