INDUSTRY NEWSNationalReal Estate News

Tight stock levels prop up spring clearance rates

Tight stock levels and rising prices around the country are continuing to help boost auction clearance rates according to experts.

According to AuctionWORKS Director and Chief Auctioneer Jesse Davidson, a lack of choice for buyers and rising demand had led to strong competition for good properties.

“A lot of agents expected there to be a deluge of stock this spring but that hasn’t come,” Mr Davidson said.

“There are still good numbers and clearance rates are still very strong.”

He said that across Sydney, clearance rates have averaged between 71 and 72 per cent over the past month, based on lower stock levels.

However, higher interest rates are starting to slow buyers down.

“Over the past two or three weeks, some agents have told me that enquiry levels are slowing down a little bit, but that’s still only anecdotal,” he said.

“But the truth is that there is just not a lot of stock out there.”

Mr Davidson said even in places like the Eastern Suburbs of Sydney supply is low.

“Even in the Eastern Suburbs they’re not getting the level of supply they had expected this spring,” he said.

“But we are still seeing good results.

“I sold seven out of eight auctions this weekend and those numbers have been pretty consistent this month.”

Apollo Auctions Director Justin Nickerson said it was clear the rising market conditions were also underpinning auction results around the nation.

He said across the country, clearance rates have averaged about 61 per cent, which is higher than this time last year.

“Overall, we saw an average of about 30 people attending auctions, with a solid average of 3.31 registered bidders recorded as well,” Mr Nickerson said.

Mr Nickerson said there was an average of 61 per cent of active bidders at auctions nationwide, with Perth recording an average of 78 per cent in the September quarter.

“Brisbane and Victoria dominate the best auction clearance results, both recording 71 per cent over the past quarter,” he said.

“Perth, seen as the hottest real estate market in the country at present, also recorded the highest average attendance rates at 40.3 as well.”

According to Mr Davidson, the top end of the market is the area that is performing best of all.

“The top end of the market seems to be bucking the trend altogether,” he said.

“The top end of each area seems to be very strong.”

He said that he has been seeing a number of suburbs that are setting new record highs at auction, which is positive.

“What I think it will do is probably encourage others to sell,” Mr Davidson said.

“When you start to get new records in new areas and in new streets, owners start thinking to themselves that the money’s not a bad option.

“And at the very top end of the market, interest rates don’t necessarily matter.

“If you’re paying $25 million for a house, you’re probably not financing it.”

Mr Davidson said looking towards the run into the end of the year, he expects markets to remain steady.

“I think the best word is consistent,” he said.

“November looks like it will be relatively strong.”

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Rowan Crosby

Rowan Crosby is a senior journalist at Elite Agent specialising in finance and real estate.