The auctions market has continued to show signs of ongoing strength, with clearance rates remaining above 60% in the major capital cities.
The moves comes after several weeks of positive property data, including price rises recorded by RP Data, Rismark International and the Australian Bureau of Statistics. Clearance rates have also remained above 60% and are up compared to the same time last year.
Analysts also suggest another rate cut will help boost sentiment even further, following on from the Reserve Bank’s decision to slash rates by 25 basis points earlier this month.
According to the Real Estate Institute of Victoria, Melbourne recorded a clearance rate of 62% compared to 60% last week and 53% this same time last year. But chief executive Enzo Raimondo said the main test for the market is yet to come.
“A significant test for the market will occur next weekend when around 1,200 auctions are expected, the highest number for a weekend since December in 2010.”
SQM Research managing director Louis Christopher says it’s a good sign – and says clearance rates could reach as high as the high 60s or even low 70s by February or March if conditions continue.
“We’re really seeing that results are higher than at this time last year, and it’s been happening for a large number of consecutive weeks.”
“We could see auction clearance rates reach even higher next year, if conditions continue.”
Sydney recorded a clearance rate of 56%, down from last week’s rate of 60%, but up from last year’s 52% result.
A report out today from BIS Shrapnel suggests housing market conditions in the capital cities will continue to improve, but that a small boom in prices wouldn’t actually help long-term recovery.