CoreLogic’s Quarterly Auction Market Review released today revealed Australia’s combined capital cities clearance rate reached 80.0% over the first quarter of 2021, up from 69.4% in the December 2020 quarter and 62.5% in the March quarter of 2020.
Looking at auction volumes, there were 19,004 homes taken to auction across the combined capital cities over the three months to March 2021, compared to 20,489 over the December quarter, and 18,902 this time last year.
CoreLogic’s weekly auction clearance rate across the combined capitals has been at or above 80% just five times since 2008, and four of those were in March 2021. The week ending 28th March 2021 recorded the highest auction clearance rate on record (83.1 per cent), while also being the busiest week for auctions since late March 2018.
Eliza Owen, CoreLogic’s Head of Research Australia, says “The strength in auction clearance rates through the March quarter corroborate the rise in demand seen across the market more broadly, as dwelling values in the combined capital cities shot up 5.6% in the quarter. This was illustrated through the month of March, when the combined capital cities saw a record high clearance rate of 83.1%, against 3,840 scheduled auctions; the highest volume since March 2018.”
Ms Owen says the market has been spurred on by record-low mortgage rates, swiftly improving economic conditions, and a sense of scarcity as total listings across the country remain 26.0% below the five year average.
“Sub-market performance across Sydney and Melbourne also echo some interesting housing market trends, such as the desirability of lifestyle markets, which is reflected in especially high clearance rates across the Illawarra (85.1%), the Mornington Peninsula (86.1%), and the Central Coast (86.7%). The Mornington Peninsula and Central Coast also had among the largest year-on-year increase in the clearance rate, up from 50.0% and 46.2% respectively,” says Ms Owen.
The strongest auction markets reflects a resurgence in demand at the high end of the Sydney dwelling market, including the North West, North Shore and the Northern Beaches regions. This coincides with an 8.8% increase in values in the high end of the Sydney dwelling market through the March quarter.
“Interestingly, smaller, less traditional auction markets such as Brisbane, Perth and Adelaide have also sustained very high clearance rates through the start of 2021.
“In the coming quarters, we might expect auction volumes and clearance rates to ease. As with private treaty listings, auction volumes usually see a seasonal dip through cooler months. Auction clearance rates may also be tested as rising values create affordability constraints,” says Ms Owen.