Confidence coming back to auctions as restrictions are eased in Sydney and Melbourne
Buyer confidence has started to return to the property markets in Melbourne and Sydney as coronavirus-related restrictions across the cities, including restrictions on the number of people allowed at public auctions, continue to be eased.
In Melbourne, clearance rates had a sharp increase on Saturday with a preliminary clearance rate of 70.1 per cent after 102 auctions and 79 reported results.
It followed a lacklustre restart to on-site auctions the previous weekend, when bans to public auctions were lifted by the Victorian government after seven weeks, allowing 10 people to participate.
But agents are hopeful a greater easing announced on Sunday, allowing 20 people to take part in a public auction from June 1, will help to boost the market further.
In Sydney, clearance rates fell slightly compared to the previous weekend, sitting at 66.8 per cent after 247 auctions and 168 reported results.
AMP Capital chief economist Shane Oliver said these results were off low auction numbers, even compared to last year, where numbers were lower than normal during the market downturn.
“It looks like confidence on the part of buyers and sellers has returned to some degree as auctions come back,” Dr Oliver said.
New listings were still very low, down significantly since the same time last year, Dr Oliver said, however he added that history showed that with improved auction clearance rates, the number of properties for sale also rose.
Dr Oliver said he was hesitant to read too much into the improved figures for Melbourne and continuing results for Sydney, with the unemployment rate, a collapse of immigration and higher rental vacancy rates all weighing heavily on the housing market.
“A lot of Australians do still have jobs and they’re looking for property. They’re seeing mortgage rates are down to record low levels,” Dr Oliver said. “But it remains to be seen whether that will translate into sales.”
Despite the unknowns, there were still confident buyers out and about on the weekend, making some big bids.
One of the biggest results for the weekend was in Sydney.
A three-bedroom home at 91 Florida Road, Palm Beach sold for a whopping $350,000 above the reserve for $4.35 million.
The classic 1920s cottage was snapped up by an upper north shore family who bid against three others to win the keys.
Ray White Prestige Palm Beach director Noel Nicholson said the vendors were ecstatic after the sale of the much sought-after home.
“Buyers just completely understand the importance of Palm Beach as a whole – they’re turning their dreams into a reality here,” Mr Nicholson said.
An investor was the winning bidder on a six-bedroom, two-storey house in Homebush West, on Saturday.
The sold brick home at 22 Tavistock Street sold under the hammer for $1.69 million.
Belle Property Strathfield’s Joe Bousimon said the auction saw 13 registered bidders competing for the sale.
Buyers were returning to the market, though they were still a little hesitant, he said.
“We’re getting a lot of heads through the doors but there’s still a lot of tentativeness from the buyers,” Mr Bousimon said. “There has been a little bit more momentum rolling through in the past couple of weeks.”
In Sydney’s south west, a three-bedroom terrace home at 26 Nassau Lane, Erskineville, sold under the hammer for $1.687 million – $87,000 above the reserve.
Ray White Surry Hills director Shaun Stoker said six registered bidders had fought it out, with a huge opening bid of $1.4 million.
In the end, it was a young professional who was the winning bidder.
“This is as good as it gets and the owners are thrilled with the result – the sale was well and truly above the expectations,” Mr Stoker said.
Melbourne also recorded some big sales, with one of the biggest the private auction of a four-bedroom home at 371 Waverley Road, Malvern East.
The property sold under the hammer for $2.105 million to a family wanting to be close to good local primary schools.
Selling agent Marshall White Stonnington’s Fiona Ansell-Jones said four registered bidders had battled it out for the keys.
The house had been extremely popular with 75 private inspections being held through the sales campaign.
Ms Ansell-Jones said the easing of restrictions on the number of people allowed at auctions in Victoria would make selling easier.
“We’re really conscious of turning away people and potential bidders because there are too many people [at an auction],” Ms Ansell-Jones said. “It will be very helpful.”
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