Despite lower volumes and a slew of withdrawals due to tough lockdown conditions in Sydney, Melbourne and Canberra, Australia’s residential auction market proved resilient throughout the September quarter.
CoreLogic’s Quarterly Auction Market Review for the three months to September 2021 shows 23,184 properties were taken to auction across the combined capital cities, down from 31,605 during the June quarter 2021.
The combined capital city clearance rate of 71.7% for the September quarter was down slightly from the 75.7% recorded in June but a strong improvement on the comparable quarter in 2020 when 59.2% of reported auctions were successful.
The report covers auctions held in the week ending 4 July to 26 September, when Sydney, Melbourne and Canberra entered their respective extended lockdowns.
This resulted in fewer auctions and reported withdrawals figures averaged 18.3% nationally for the quarter, significantly higher than the 7.3% withdrawal figure recorded in the June quarter.
CoreLogic’s Research Director Tim Lawless said despite the restrictions Sydney’s auction clearance rate during this period held reasonably firm, averaging 78.0% compared with the preceding June quarter average of 78.6%.
“The steady result, albeit on a lower volume of auctions, demonstrates the strong selling conditions that have persisted across Sydney despite the lockdown,” Mr Lawless said.
“Throughout the September quarter, advertised supply levels have remained low while buyer demand has reduced but remained well above average. With demand outweighing supply, vendors have remained in a strong selling position while buyers have continued to feel a sense of urgency as Sydney housing values rose by approximately $620 per day during the quarter.”
Withdrawal rates heavily impacted Melbourne’s clearance rate of 62.8% for the September quarter, down from 73.3% over the previous quarter. At its peak, 61.6% of auctions were withdrawn in the week ending 29 August due to lockdown restrictions.
There were 9,493 properties taken to auction for the quarter compared to the three months to June when 13,693 properties were scheduled for auction.
“Melbourne’s auction conditions were profoundly weaker relative to Sydney through the September quarter, with the clearance rate falling to 35.9% over the last week of August,” Mr Lawless said.
“The difference between Sydney and Melbourne clearance rates through the September quarter highlights the importance both buyers and sellers put on the ability to physically inspect a property.”
Following the easing of rules on September 18, Mr Lawless said Melbourne’s clearance rate bounced immediately higher as fewer auctions were withdrawn and buyer confidence improved.
A full city-by-city suburb analysis, where at least 20 auction results were reported over the quarter, can be found in the report.