While sales took a dramatic hit last year as the pandemic forced buyers and sellers to kick their plans to the curb, 2021 has brought a promising turnaround for the property market.
Auction clearance rates in Sydney soared above 80% at the start of February, as buyers sought houses in the middle and outer suburbs to adapt to the flexibility of working from home.
The auction clearance rate is a measure of the percentage of properties sold at auction on a particular week. This year, it is setting new records.
“Every capital city recorded a clearance rate above 70% as volumes continued to surge higher after the festive period slowdown,” said the property research firm CoreLogic in its early analysis.
“Such strong auction results signal further upwards pressure on housing prices amidst extremely tight advertised supply levels and above average buyer demand.”
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Sydney’s auction clearance rate reached an astonishing record, hitting a 24-year high. The preliminary clearance rate achieved 88.7% after a recorded 272 auctions, which has not happened since June 14, 1997 when the finalised clearance rate was 89%.
Domain senior research analyst, Nicola Powell said, “We do expect a bounce early in the auction season because there are lower volumes of homes for sale and more home buyers on the market after the holidays.
“That said, it’s a very robust result and highlights the market is in an upswing and it is a very competitive market,” she said.
Melbourne also had a big result, recording 388 auctions and a clearance rate of 83%.
A year ago, Melbourne had 211 auctions listed with a 65.8% clearance rate and Sydney 158 auctions with a clearance of 72.9%.
Canberra and Adelaide also recorded strong results, with clearance rates above 80%.
Perth recorded a 66.7% clearance rate, an increase from 38.9% a year ago. Brisbane cleared 55.2%, up from the previous 36.6% last year.
The figures indicate hope and optimism for the property market.
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Property researcher CoreLogic reported 891 homes were up for auction nationally, 266 more than last year of the same week, returning a national clearance rate of 81.1%, well above last year’s 61%.
CoreLogic head of research, Tim Lawless said record low interest rates are driving consumer confidence, especially amongst first homebuyers.
“Consumer sentiment, which measures household mindsets about their finances and domestic economy and the willingness to make a high commitment decision, is seeing people get back into the market,” Mr Lawless said.
“If you’re going to be buying a home, it’s a big decision so to have a decent level of confidence is important.”
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This week over 1000 houses went under the hammer, and across the combined capital cities the preliminary auction clearance rate returned at 83.8%.
It shows an improvement compared to last week’s clearance preliminary result of 81.1%, when a lower 884 auctions took place, which revised down to 77.2% by final figures.
With interest rates at an all-time low, cheap finances and rising house prices, Sydney agents are being flooded with buyer interest. Many are reporting long queues at open-home inspections and dozens of pre-auctions offers.
This shows promise for the property market to keep growing and for the Australian property market to bounce back after the hit of COVID-19.
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Words by Ece Demir
- Auction clearance rates soar as heat returns to property market
- CoreLogic Auction Results
- Preliminary clearance rate improves as volumes rise across the combined capitals
- Sydney’s auction clearance rate hits highest point in 24 years
- The 2021 auction market takes off with 891 capital city auctions this week
- What’s fuelling Sydney’s highest auction clearance rate since 1997?
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