Property glut pulls down metro clearance rates

Sydney and Melbourne auction markets recorded sharp falls in clearance rates over the weekend, amid a surge in listing numbers spoiling buyers for choice.

According to Domain Group senior economist Dr Andrew Wilson, Sydney’s weekend auction market continues to track backwards, with falling clearance rates recorded over the past three weekends.

“This weekend’s 73.5 per cent result was the lowest recorded for four months and the third consecutive result below 80 per cent for the first time this spring,” he said.

“Sydney commenced the spring selling season this year with nine consecutive clearance rates above 80 per cent. The market has clearly lost that early energy, with five out of the last seven weekends below the 80 per cent benchmark,” he added.

Dr Wilson said high auction numbers continue to test the weakening market with record listing numbers expected through to the Christmas break.

“Next weekend is set to challenge the all-time Saturday record for [Sydney] auctions with over 1,000 scheduled,” he said.

The Melbourne weekend auction market also reported a sharp fall in activity at the weekend, with the clearance rate falling to the lowest recorded this year.

“The weekend result of 67.1 per cent was well below last weekend’s 72.1 per cent, with the local market clearly tracking backwards since the Melbourne Cup weekend holiday,” Dr Wilson said.

“A surge in late spring auction numbers is impacting market activity with buyers increasingly spoiled for choice.

“This weekend 1,154 properties were listed for auction, almost identical to the previous weekend’s 1,153 and well ahead of the 931 auctions conducted over the same weekend last year.

Next weekend will close off November with over 1,300 auctions expected in the metro area,” he added.

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