Despite increasing interest rates, Australia records the highest preliminary clearance rate since late May 2022 across combined capitals. Based on CoreLogic’s latest data, 1,799 homes went under the hammer across the combined capital cities, up from 1,618 (+11.2%) in the previous week.
Meanwhile, vacancy rates plummet as rent hikes bite renters. Continue reading to find out which cities led the auction rates and the latest update on the rental market.
Preliminary total auctions in capital cities
Auction activity remained strong across combined capitals as CoreLogic recorded 1,799 homes up for auction this week.
Kaytlin Ezzy, CoreLogic’s economist, notes, “Despite the upwards trend in the volume of auctions, this week’s auction activity is significantly below the number of auctions held this time last year (2,708) when selling conditions were stronger and clearance rates were higher (80.2%).”
Based on CoreLogic’s recent Property Pulse, Melbourne still topped this week’s auctions with 721 homes, a slight decline from 833 last week. This time last year, the city recorded 1,351 homes for auction.
Going after Melbourne was Sydney with 686 auctions – a steep increase of 41.7% from last week’s record of 489 when auction activities were interrupted by public holidays.
Of the smaller capital cities, a change of tide occurred as Adelaide held the busiest auction week with 144 homes, which was 44% higher compared to last week’s volume of 102. Following Adelaide was Brisbane with 124, a slight upward move of 5.1% from 116 last week.
Canberra recorded the highest increase in auction activity as the city put up 114 homes, which was 86.9% higher than last week’s record of 61. Meanwhile, Perth had 10 homes up for auction, down by -47.4% from 19 last week while Tasmania didn’t have any auctions.
Preliminary total clearance rate
Despite the official cash rate hitting a record high of 2.60% for October 2022, the momentum is still up for auction activities as they remain above the 60% mark while Australian property continues to dip.
Preliminary clearance rates across the combined capitals remained above the 60% mark for the sixth consecutive week with 63.4% of the 1,441 results collected so far turned successful. This is up by 1.1% from the previous week’s preliminary rate of 62.3%. This week’s preliminary rate was the capital’s highest since late May 2022 (63.7%).
Melbourne’s preliminary clearance rate rose to 66.1% from 64.3% last week. This was the city’s highest preliminary rate since it recorded 68.4% in early May. This time last year, Melbourne had 77.3% successful auctions.
Following Melbourne is still Sydney with a 61.3% preliminary clearance rate, up from 60.4% last week. This was Sydney’s highest preliminary clearance rate since it recorded 63.4% in mid-August.
Ezzy states, “Despite the rise in the preliminary clearance rate, Sydney’s withdrawal rate rose from 17.0% last week, to 21.1% this week, while the portion of properties passed in at auction fell to its lowest rate since early March (17.2%) to 17.6%.”
Among the smaller capital cities, Canberra led the preliminary clearance rate with a record of 70.9%, the city’s highest record since early June. Coming in second was Adelaide with 69.7% and Brisbane with 49.4%. On the downside, only one of the 10 auctions in Perth was successful.
Rent vacancies hit a record low
Based on CoreLogic’s Quarterly Rental Review for Q3 2022, the national rent index only increased by 0.6% this month and 2.30% over the September quarter. This is 0.60% below the three months to June record of 2.90%.
“The slow down in the rate of rental growth may suggest an increasing number of prospective tenants are starting to come up against affordability constraints,” Ezzy reports.
Furthermore, advertised rental supplies are -35.4% below the previous five-year average as dwelling vacancy rates plummet to a record low of 1.1% in September.
As rent vacancies decrease and property prices still favour buyers, you may consider taking advantage of the current situation and buying your dream home for a cheaper price. This way, you spend your hard-earned money on your own property instead of renting.
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