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The combined capital city clearance rate exceeded 80 per cent in the first quarter of 2021, propped up by a number of lifestyle markets.
It marks only the fifth time in 13 years that the quarterly rate has hit or surpassed 80 per cent.
Building on the post-pandemic recovery trend, the combined capital city clearance rate expanded to 80 per cent, up from 69.4 per cent a quarter earlier and 62.5 per cent last year, CoreLogic’s Quarterly Auction Market Review has revealed.
“CoreLogic’s weekly auction clearance rate across the combined capitals has been at or above 80 per cent just five times since 2008, and four of those were in March 2021,” said CoreLogic’s head of research Eliza Owen.
Meanwhile, the highest auction clearance rate on record, standing at 83.1 per cent, was clocked in the week ending 28 March 2021. With 3,840 scheduled auctions, it was also the busiest week for auctions since late March 2018.
“The strength in auction clearance rates through the March quarter corroborates the rise in demand seen across the market more broadly, as dwelling values in the combined capital cities shot up 5.6 per cent in the quarter,” Ms Owen said.
But while auction rates increased substantially in the first quarter, auction volumes were down to 19,004 homes from the previous quarter’s 20,489. They did, however, beat last year’s 18,902.
Looking at the capital cities individually, Canberra and Sydney saw the highest quarterly clearance rates at 85.4 per cent and 84.5 per cent, respectively, in the first three months of 2021.
Adelaide was next with 79.8 per cent, followed by Melbourne with 77.5 per cent, Brisbane with 69.1 per cent, Perth with 67.2 per cent and Hobart with 53.3 per cent.
Of the capital cities, Melbourne saw the highest auction volumes with 9,065, followed by Sydney with 7,043, Brisbane with 1,004, Adelaide with 894, Canberra with 796, Perth with 187 and Hobart with 15.
Overall, total listings across the country have remained 26 per cent below the five-year average.
Along with record-low mortgage rates and improving economic conditions, the scarcity of listings has spurred the strength of the current market, according to Ms Owen.
Best-performing markets
Reflecting current market trends, lifestyle markets have emerged with some of the highest clearance rates through the March 2021 quarter, including Illawarra (85.1 per cent), the Mornington Peninsula (86.1 per cent) and the Central Coast (86.7 per cent).
The Mornington Peninsula and the Central Coast also saw the biggest year-on-year clearance rate increase at 50.0 per cent and 46.2 per cent, respectively.
“The strongest auction markets reflect a resurgence in demand at the high end of the Sydney dwelling market, including the North West, North Shore and the Northern Beaches regions. This coincides with an 8.8 per cent increase in values in the high end of the Sydney dwelling market through the March quarter,” Ms Owen said.
Other strong performers included Sydney’s Coogee, Frenchs Forest, Cherrybrook, Glebe and Wentworthville with 100 per cent clearance rates; Melbourne’s Ringwood East and Heidelberg with 100 per cent; Brisbane’s Camp Hill with 100 per cent; and Canberra’s Ngunnawal with 95.8 per cent.
Looking ahead, Ms Owen said that auction market activity may start to ease, primarily due to seasonal dips and rising values.
“In the coming quarters, we might expect auction volumes and clearance rates to ease. As with private treaty listings, auction volumes usually see a seasonal dip through cooler months,” the researcher said.
“Auction clearance rates may also be tested as rising values create affordability constraints.”
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