As predicted, the 2022 auction year has kicked off early, with 448 properties taken to auction across the combined capitals this week.
By Sunday morning, CoreLogic was reporting a preliminary clearance rate 68.6 per cent based on 310 results collected so far.
The auction volume for the first major weekend of the year is significantly higher than in years gone by, and almost double the same time last year when 244 properties went under the hammer.
These results did not take into account the Ray White Surfers auction, which saw over 77 residential, commercial and prestige properties on the Gold Coast go under the hammer on Sunday alone as part of their major event for the year, which this year involves 146 properties in total.
CoreLogic tips the number of homes taken to auction will continue to rise over the coming weeks, with over 1150 auctions expected to be held next week, compared to 884 over the same week last year.
Melbourne proved the busiest auction capital this week, with 144 properties taken to auction.
Of the 100 results collected so far, 64 per cent reported a successful result, which was roughly on par with the average final clearance rate through December (63 per cent).
Over the same week last year, 127 homes were taken to auction across the city.
In Sydney, 79 homes were taken to auction this week compared to 37 this time last year.
Of the 60 results collected so far, 58.3 per cent were successful, which is down slightly from the December average where 60.4 per cent of auctions cleared.
The smaller capitals
Clearance rates were generally higher across the smaller capitals, continuing the stronger trend observed through late last year.
Adelaide recorded the highest preliminary auction clearance rate (78 per cent), followed by Canberra (76.2 per cent) and Brisbane (76.1 per cent).
Perth saw 50 per cent of homes sold, although volumes remain low across the city.
There were two auctions in Tasmania this week, with one reporting a successful result.
Record auction figures in December
The early start to the auction year comes off the back of a record December quarter in 2021.
CoreLogic’s Quarterly Auction Market Review noted 42,918 properties were taken to auction across the combined capital cities in the three months to December 2021 – an 85.1 per cent increase from the previous quarter and more than double (109.5 per cent) the December 2020 figures.
CoreLogic’s Research Director Tim Lawless said several factors resulted in the surge in auctions, including some catch-up from the September quarter when the largest auctions markets were in lockdown as well as a pickup in activity following the seasonally slower conditions of winter.
“The large number of auctions held through the December quarter also reflects the strong selling conditions that were present, which motivated vendors to capitalise on strong buyer demand and the significant rise in values seen through the pandemic,” Mr Lawless said.
“Auctions as a way of selling tend to be more popular during a sellers’ market; in this situation buyers are highly competitive and incentivised to outbid rival purchasers in order to secure a property.
“During cooler market conditions an auction may not attract as many registered bidders or as much competitive bidding.”
In Australia’s two biggest auction markets, Melbourne had 19,788 auctions and a clearance rate of 69.7 per cent for the December quarter compared to Sydney, where 14,906 auctions were held at a clearance rate of 69.9 per cent.
Across the combined capitals, the quarterly clearance rate of 71.3 per cent was only slightly down on the previous quarter results of 71.7 per cent.
However, as the quarter progressed and the volume of auctions held increased, the clearance rate progressively trended lower to 61.1 per cent in the week ending 19 December, 2021.
Mr Lawless said higher auction volumes will often correspond with lower clearance rates as demand becomes more thinly stretched.
“The surge in the number of auctions through the final quarter of 2021 was accompanied by a consistent trend towards lower clearance rates, with this trend evident across each of the capital cities,” he said.
“The drop in clearance rates implies demand didn’t quite keep pace with the level of auction supply during the quarter.”
In the smaller capitals, Brisbane had 3027 auctions over the December quarter with a clearance rate of 74.9 per cent, Adelaide had 2902 auctions and a clearance rate of 80.5 per cent, and Canberra hosted 1949 auctions and returned a clearance rate of 82.4 per cent.
Each of the smaller capitals also recorded significant increases in volumes compared to Q3 2021, and the corresponding quarter in 2020.