Auctions: The property market is cooling down but one measure of success is firing up
The property market has been cooling down but one key measure of success is firing up late in the year.
The clearance rate for the combined capital cities reached a seven-month high in November, with the number of properties sold before auction also peaking as buyers and sellers marry on price expectations.
About one-in-four properties – 22.1 per cent – in November changed owners before a scheduled auction, with negotiations successfully striking the sweet spot between the hopes of cautious buyers and keen sellers.
The national metro clearance rate for the month clocked in at 58.7 per cent, which is the highest since April and the third consecutive month above 55 per cent, Domain research found.
30 Plunkett Road, Mosman, New South Wales
For the combined capitals, the volume of properties sold before auction day is also at its greatest since April, Domain data shows.
However, the individual clearance rates across all capitals are weaker compared to November last year – unsurprisingly due to the bite of interest rate rises, despite tumbling prices.
Sydney was especially strong in November, with its clearance rate landing above 60 per cent for the first time in eight months.
One of the standout sales in Sydney on the weekend of December 3 was in Mosman, setting a new suburb auction record of $16.3 million.
The vintage, five-bedroom, water-view property 30 Plunkett Road was held by the owners since about 1963.
The sum of $16.3 million is the most ever paid under the hammer for a home in Mosman. Listing agent Stefon Bertram of Pello Lower North Shore said the Sydney market has wings in December because buyers and sellers are treating it like a “late spring”.
“Instead of a traditional auction date as a deadline, Christmas is the deadline, which is creating the sense of urgency,” he said.
“It has been an action-filled year – the federal election and, with the rolling up of lockdowns, there has been a massive surge of buyers putting their search on hold for a time because they had major travel booked in after two years.
“And what we have found is many people have had the holiday, they have seen the economy post-election and now the dust has settled, they want to take action before Christmas.
He having more than one serious buyer circling 30 Plunkett Road propelled it to a new benchmark result.
“With a lot of properties of this calibre it is not uncommon to have one standout buyer, but this, because it has the north aspect, the gate to Balmoral beach and the Plunkett address, it ticked so many boxes and a lot of people loved it.”
Offers for the home prior to auction day sat in the realm of $13 million to $14 million, Bertram said, but under transparent auction conditions, buyers could see the level their competitors were willing to hit – and it soared.
In November, Brisbane registered its strongest clearance rate since June, with an increase of a size not seen since April last year.
Adelaide held onto its title as Australia’s “best-performing” city for property, according to Domain, with a clearance rate of 65 per cent. However, Canberra and Melbourne slipped over the month (Melbourne only slightly).
Dr Nicola Powell, Domain’s chief of economics and research, said clearance rates have “continued to steadily rise” during a busy period, as buyers and sellers unite on price, although it is a different market to the same time last year.
“This shows that cautious buyers and sellers are starting to see eye-to-eye amid falling house prices and rising interest rates,” Dr Powell said in the auction report.
“While the monthly trend is showing stability, the capital city clearance rates are much lower compared to this time last year.
“The sold prior data is also at its highest point since April implying more vendors are opting to sell privately rather than going to auction in a lower demand market.
“Moving into early next year, we’ll continue to see sellers needing to be more realistic on price while buyers continue to return to the market with a clearer idea of their budgets.”
Must-see properties going to auction in December
9 Jago Street, Richmond, Victoria
Price guide: $1.2 million – $1.3 million
Auction: December 10, 2pm
614 Vulture Street, East Brisbane, Queensland
Auction: December 10, 10am
9 Anderson Avenue, Glenelg North, South Australia
Auction: December 10, 9am
2/74 Lagoon Street, Narrabeen, New South Wales
Auction: December 10, 8am
Price guide: $1.4 million
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