News

September 29, 2016

Sydney auction property market bounces back with surprise clearance rate

The Sydney home auction market has bounced back hard by recording its highest clearance rate since June last year, at the height of the then-record boom in house price growth.

Sydney recorded a stunning clearance rate of 85.1 per cent on Saturday, which was well ahead of the previous weekend’s surprisingly-low result of 77.1 per cent and, remarkably, nearly 15 per cent higher than the 71.3 per cent recorded over the same weekend last year.

Although growth rates are unlikely to match last year’s record levels, prices will nonetheless prove more headaches for local first home buyers struggling to get into the market.

The Australian Bureau of Statistics data showed first-home buyer loans in NSW have fallen by 4.6 per cent over the first seven months of this year compared to the same period a year ago, with estimates of five years of savings from average incomes now required to get into the market – at today’s house prices.

Sydney has now recorded five weekends out of the past six with clearance rates at or above 80 per cent, with the early spring market a bonanza for sellers. This in sharp contrast to last spring when rates fell backwards steeply to well below 70 per cent, as the market was dampened by higher mortgage rates.

A shortage of auction listings is contributing to higher clearance rates, with buyers competing fiercely for available stock. Just 567 auctions were conducted on Saturday, which was similar to the previous weekend’s 565 and again well below the 832 conducted over the same weekend last year.