Buyer caution keeps capital city auction clearance below 50%
Capital-city auction conditions remained soft for a second consecutive week, with the preliminary combined clearance rate at 48.8 per cent despite a slight improvement from 48.2 per cent a week earlier.
Cotality recorded 1,781 homes taken to auction across the capitals, 31.2 per cent fewer than on the corresponding weekend a year earlier. Research director Tim Lawless said it was unusual for clearance rates to remain below 50 per cent for two weeks and linked the result to cautious buyers and weak confidence.
The figures came during the usually active spring selling season. Auction clearance rates had already been low for several months amid difficult borrowing conditions, interest-rate increases and federal budget tax changes, which the report said had contributed to falling property prices.
Vendors reset expectations as buyers reassess
McGrath Estate Agents founder John McGrath said his agencies across the east coast held 20 per cent fewer auctions than on the same Saturday last year.
He believed the property downturn had reached, or was close to, its bottom. McGrath said vendors entering the market were now better informed about changed prices than sellers had been three to six months earlier.
He also said some buyers were returning because price discounts had become reflected in vendor expectations. In his view, the period before Christmas could present buying opportunities, while 2027 might bring stabilisation and possibly renewed price growth. Those comments were market forecasts rather than established outcomes.
Results vary sharply between cities
Melbourne recorded the highest auction volume among the capitals, with 707 homes taken to auction and a preliminary clearance rate of 54.8 per cent.
Sydney held 653 auctions, more than double the previous week’s total after the long weekend, and returned a preliminary clearance rate of 52.9 per cent.
Brisbane recorded 201 auctions, an increase of 45.7 per cent from the previous week. However, its early clearance rate was only 21.4 per cent, the lowest reported for the city since the early stages of the COVID-19 pandemic in April 2020.
Victorian rule changes affect the forward schedule
The report said Victorian agents must publish a seller’s reserve price as a single dollar amount at least seven days before an auction or fixed-date sale. It stated that the requirement took effect on 1 October.
Cotality expected Melbourne auction volumes to decline 34 per cent the following weekend. The projected drop coincided with further auction rule changes scheduled to begin on 16 October.
Melbourne-based buyer’s agent Emma Bloom argued that the reserve-price requirements could discourage auctions and lead to more properties being negotiated privately. Her comments reflected concern about the practical effect of the regulation rather than a confirmed market-wide shift.
The combined capital-city figures show that reduced listing volumes have not been enough to lift clearance rates above 50 per cent. Buyers remain selective, while vendors and agents continue adjusting to weaker prices, tighter finance and new selling rules.
SOURCE ATTRIBUTION:
Based on reporting by Sarah Petty. Source: supplied article.
