With results for the final week of the month now in, October has had the lowest average clearance rate of any month so far this year.
Last week, the weighted average final clearance rate across the combined capitals fell 4.0 percentage points to 43.6%, from 47.6% the previous week, the lowest weekly clearance rate since late June (42.3%).
Across the four weeks of October, clearance rates averaged 45.2%, 0.5 percentage points below June (45.7%), which had previously been the softest month this year. The previous week’s 47.6% was the highest weekly clearance rate of the month. For comparison, the weighted average clearance rate peaked at 66.4% in February.
Auction volumes lifted 32.3% over the week, with 1,871 auctions held compared with 1,414 the previous week. Compared with the same week last year (3,236 auctions), auction volumes were 42.2% lower.
Most of the weekly increase in auction volumes came from Melbourne, which held 831 auctions, 67.9% more than the 495 of the previous week. That said, vendors in Melbourne appear to have brought auctions forward ahead of the Melbourne Cup Day. Melbourne’s clearance rate eased 1.5 percentage points to 50.2%, the highest of the capital cities. Sydney’s clearance rate fell 8.7 percentage points to 41.7%, despite more homes going under the hammer, with auction numbers up 9.3% to 623.
Fewer than half the homes taken to auction sold in Brisbane, Adelaide, Perth and Canberra. Brisbane had the lowest rate at 26.3%, down from 29.6% a week earlier, even as auction numbers increased 24.4% to 199. In Adelaide, the clearance rate eased to 35.3% from 35.5%, with 139 auctions held, an increase of 14.9% on 121. The steepest weekly fall in clearance rates was in Canberra, where the clearance rate decreased by 16.3 percentage points to 46.7% from 63.0%, across 60 auctions compared with 54. Perth was the only capital to see a higher clearance rate, with nine of its 19 auctions selling, compared with five of 13 the previous week. Tasmania held no auctions, after one the previous week.
Even this year’s February peak (66.4%) fell short of the 66.7% clearance rate seen in the same week last year with last week’s clearance rate 23.1 percentage points below that level. Every capital that held auctions last week had a lower clearance rate than a year earlier. The largest annual declines in clearance rates were in Brisbane and Adelaide, where clearance rates fell to 26.3% and 35.3%, respectively, from 65.4% and 73.6% a year earlier. Sydney’s clearance rate has fallen to 41.7% from 65.3% a year earlier, and Melbourne’s to 50.2% from 67.4%. The annual falls were less pronounced in Canberra and Perth, where clearance rates were 46.7% and 47.4%, down from 61.1% and 58.8% respectively. Tasmania held no auctions last week, leaving no clearance rate to compare.
Melbourne and Sydney accounted for almost all of the annual decline in capital city auction volumes, with 1,339 fewer auctions between them out of a total fall of 1,365. Melbourne held 831 auctions, less than half the 1,836 held a year earlier, while Sydney’s volume fell 34.9%, from 957 to 623. Brisbane and Perth were the only capitals to see increases, with 11 and two more auctions respectively. Auction volumes fell by 30 in Canberra, five in Adelaide and four in Tasmania.
Cotality Media Release by Annabelle Mezieres (Economist)
