Brisbane home auction market dips over November

The home auction market dipped over November with buyer activity falling to its lowest level of the year so far.

Brisbane recorded a November clearance rate of 38.8 per cent which was well down on the 50 per cent recorded over October and also below the 43.9 per cent reported over the same month last year.  

The November clearance rate was clearly the lowest of all the capitals, with Melbourne the highest at 66.9 per cent

Despite the clearance rate falling sharply over the month, auction volumes continued to rise. There was an average of 143 auctions per weekend – up again from the 128 averaged over October and also ahead of the 135 averaged over November last year. November auction numbers were the highest monthly averages on record.

Record auction volumes have been a characteristic of the market for most of this year with November clearly continuing the trend.

The median auction price also fell sharply over November by 11.3 per cent to $634,250 and is now down by 9.4 per cent compared to the $700,000 recorded over November last year. Brisbane was the only capital to record a fall in the median auction price over the month and the only capital where prices are down over the past year.

Low and falling interest rates helped to stimulate the market last autumn and into winter, but higher mortgage rates over spring may have contributed to moderating activity.

This week the Reserve Bank met for the final time this year and reflecting generally better recent economic data, official rates were left at the record low 2 per cent.

Rates will now be on hold for eight consecutive weeks until the bank meets again in February 2016.

But as evident in recent months, mortgage rates can move independently of Reserve Bank settings and with this week reports of deposit rates being cut to below 2 per cent.

Dr Andrew Wilson is Domain Group Senior Economist Twitter@DocAndrewWilson