While Sydney and Melbourne record decline, more housing stock positive for buyers

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While clearance rates across the country have recorded a decline over the weekend, the increase in housing stock coming to the market is positive news for buyers.

This week marks exactly one year since the combined capital city auction market last recorded a clearance rate above 70 per cent, with selling conditions progressively weakening over the last year.

As property values have fallen, fewer homes appear to be selling at auction.

Across the capital cities, 2,287 homes were taken to market this week returning a preliminary clearance rate of 59.7 per cent. Last week saw the final clearance rate fall to its lowest recorded since late 2013, with 56.8 per cent of properties selling across 2,100 auctions.

Overall, the unit market has continued to outperform the house market, with 64.9 per cent of units selling this week, opposed to 57.6 per cent of houses selling under the hammer.

The performance across the smaller auction markets varied with Adelaide recording the highest clearance rate of 66.7 per cent, while only 31.6 per cent of homes sold under the hammer in Perth.

Source: CoreLogic

Melbourne

Melbourne recorded a preliminary clearance rate of 60.9 per cent this week across 1,132 auctions.

Craigieburn was the top performer with 11 auctions in the outer suburbs recording a higher clearance rate of 69 per cent.

The inner suburbs recorded the highest percentage of auction sales with about 200 of 550 sales made under the hammer. These were led by Hawthorn (9), Port Melbourne (8) and Preston (8).

Andrew McCann, an agent with Jellis Craig Glen Iris, told WILLIAMS MEDIA that it's the 'A-grade' properties that are attracting fierce competition.

"Buyers are the most attracted to the more well-presented, well-located properties, there's certainly been more competition for those. Meanwhile, the properties that suffer tend to be the 'B-grade' ones, as they often need a price adjustment - sellers are hanging on to prices from six months ago, so they need to be more flexible for buyers.

"With the increase in housing stock we're seeing, there are a lot more opportunities for buyers at the moment. There's a nice balance of supply and demand," he said.

Real Estate Institute of Victoria CEO, Gil King, said units are still outperforming houses.

"Clearance rates on units and apartments (69 per cent) remained higher than those on houses (62 per cent).

“There were two house sales exceeding $4m, one each in north Melbourne and St Kilda.

“Two apartments in Brighton East and one in Balwyn North each brought more than $1.6m.

“Buyers secured more affordable properties in Wyndham Vale (house $266,000) and in Gladstone Park, Essendon North, Frankston and Footscray, where there were apartment sales under $300,000," he said.

Sydney

Auction volumes increased across Sydney this week, with 808 auctions held across the city, returning a high preliminary clearance rate of 62.7 per cent. This was an increase on last week's result of 54 per cent, the lowest clearance rate since late 2017.

This four bedroom home in Kew sold at auction over the weekend through Jellis Craig Hawthorn. View this property on Luxury List.

Leanne Pilkington, president of the REINSW, said the northern beaches and the city continues to see strong clearance rates.

"The preliminary clearance rate across Sydney was 62.7 per cent across 808 auctions, with units being slightly more popular at 67 per cent. As we have seen throughout the year a couple of areas continue to see stronger results, particularly the northern beaches and the city, which see clearance rates of 70 per cent and over," she said.

Source: https://www.therealestateconversation.com.au/news/2018/05/28/while-sydney-and-melbourne-record-decline-more-housing-stock-positive-buyers

This article provides general information which is current as at the time of production. The information contained in this communication does not constitute advice and should not be relied upon as such as it does not take into account your personal circumstances or needs. Professional advice should be sought prior to any action being taken in reliance on any of the information.