Wednesday, September 28, 2016

Sydney Home Auction Market Up: Highest Clearance Rate Recorded

Sydney Home Auction Market Up: Highest Clearance Rate Recorded

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With the highest clearance rate recorded in the Sydney home auction market, the demand for established homes is expected to rise.

The rise in the clearance rate has been at the highest since June 2015. The rate was a quite low last week with 77.1 percent while it has increased almost 15 percent to 85.1 percent from 71.3 as recorded over the same weekend in 2015.

Fairfax Media’s Domain Groups data obtained the surprising result, which might not be very good news for local first-time home buyers but is still considerate compared to the matchless record level of last year. “This is the highest [for Sydney] since June last year, and in Melbourne, it’s the highest since early August,” Domain’s Andrew Wilson said.

“The stock levels are around where they were in 2013 and 2014 but the big difference is we have more investors than last year. There was some nonsense commentary that yields will act as a buffer [but] there is no doubt there are more investors in the marketplace.”

While clearance rates for Sydney home auction were high with 85.1 percent, it was 78 percent in Melbourne.  Where the southwest area of Sydney cleared 77.5 percent, Parramatta and Blacktown’s clearance rates were 65.8 percent and 67 percent, respectively. The Domain report discovered that the central coast witnessed the weakest clearance with a mere 60 percent.

The Australian Bureau of Statistics indicated that first-home buyers’ loans have experienced a fall by 4.6 percent in the past seven months in 2016, which is less than that in 2015. One of the most significant factors that have contributed in the rising of clearance rates is the lack of auction listings. On Saturday, only 567 auctions were conducted, almost similar to the 565 auctions last weekend. However, the frequency of auctions was again less than that of the same weekend 2015 with 832 auctions.

Meanwhile, the rate of interest has continued to be low, thereby hiking the demand for established homes.