Challenges around new policies banning onsite auctions continued to see the auction market take a hit this week, over what is usually one of the busiest weeks of the year historically. This pre-Easter weekend didn’t quite meet the usual expectations, with 45% of auctions withdrawn from sale and 84% of auctions sold prior to the event.
The last two weeks had more than 6,000 properties scheduled for auction, with anticipation high as confidence was returning to the market and home values were rising. However a rapid change of conditions and plunging confidence related to the impact of COVID-19 has changed the auction landscape with less than half of these homes selling.
There were 3,092 capital city homes scheduled for auction this week, returning a preliminary auction clearance rate of 48%. This comes off the back of last week’s final figure of 37.3%; the lowest final clearance rate recorded since CoreLogic commenced auction reporting in 2008.
Unsurprisingly the rate of withdrawn auctions remained high this week, with 45% of the auctions set to take place returning a withdrawn result. Withdrawn auctions typically comprise less than 6% of all auctions week to week. As the week’s progress it’s highly likely scheduled volumes will be substantially lower as vendors either convert their listings to private treaty method or hold off on selling their property until selling conditions and confidence levels improve.
In Melbourne, 1,248 homes were scheduled to go under the hammer this week returning a preliminary success rate of 54.7%, while last week there were 1,565 auctions returning a final clearance rate of 37.6%. The clearance rate was heavily impacted by 40% of auctions withdrawn from the market. 89% of successful Melbourne auctions were actually sold prior to the auction, indicating buyer demand remains high for appropriately priced properties.
There were 1,437 auctions scheduled in Sydney this week, returning a preliminary clearance rate of 46.9%. In comparison, there were 1,279 auctions held over the previous week and the final auction clearance rate was 40.3%. Similar to Melbourne, the clearance rate was skewed lower by a large proportion of withdrawn auctions. 45% of scheduled auctions didn’t proceed. Of those auctions that were successful, 84% were sold prior to the scheduled auction event.
As we noted last week the number of auction results collected at a preliminary stage are lower than usual as we seek to confirm the status of scheduled auctions, however, as remaining results are collected we expect the number of withdrawn auctions to rise and the final clearance rate to adjust lower.