Capital city auction volumes rebounded this week, but auction clearance rates slipped back under 50%. The results suggest buyers remain active but are increasingly selective about price.
Cotality Australia recorded 1,882 auctions across the capitals, 33.1% more than the previous week but 41.8% fewer than a year earlier. The preliminary clearance rate came in at 48.4%, below last week’s preliminary 51.2%, though that result was later revised down to 47.6% once final figures were in. The measure has held under 50% in three of the past four weeks.
Ray White Group reported a lower on-the-day clearance rate across its own network: 40.7% from 728 scheduled auctions, little changed from 40.4% a week earlier.
Thomas McGlynn, CEO of performance and value at Ray White Group, said steady national figures can hide weaker conditions on the ground. He pointed to lower open home attendance and fewer active bidders this week.
“The challenge continues to be the gap between what buyers are prepared to pay and what sellers are willing to accept, which is making it harder for transactions to come together,” McGlynn said.
Ray White NSW head of performance Callum Hogan said the effects of last month’s rate rise were becoming increasingly evident in the state’s auction market. The Reserve Bank lifted the cash rate to 4.6% on 29 September, its fourth increase this year, a rise that 40 lenders including the big four have since passed on.
“Buyers are questioning whether values have reached their bottom; however, it is creating hesitation around commitment rather than a lack of interest,” Hogan said.
Melbourne posted the biggest jump in auction numbers, from 495 to 831, though volumes were still 54.7% below the same week last year. Cotality attributed the shortfall to weaker selling conditions and Victoria’s new reserve price transparency rules, which may have led some vendors to rethink the auction method. The city cleared 54.8%.
Ray White’s figures suggest few Victorian vendors have actually abandoned auctions. Luke Banitsiotis, chief auctioneer for Ray White Victoria and Tasmania, said 10.5% of auctions have switched to private treaty since the disclosure rules began. That compares with 11.8% beforehand.
The Australian Capital Territory cleared 52.1% across 60 auctions, while half of the results reported so far from Perth’s 19 auctions were successful.
Sydney’s 631 auctions returned a preliminary clearance rate of 48.2%, the city’s first result under 50% in 12 weeks. Adelaide recorded 42.5% across 141 auctions.
Brisbane bucked the national trend on volumes, with auction numbers up 6.4% on a year earlier to 200. Its clearance rate was just 25.2%, the lowest of any capital. That result follows Cotality’s September Home Value Index, which showed Brisbane recorded the steepest monthly fall in dwelling values of any capital, at 1.5%.
For brokers, the figures suggest buyers remain in the market but are taking longer to commit, as fears of a fifth rate hike build, with Ray White pointing to the gap between buyer and seller price expectations.
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