Sydney auction property market bounces back with surprise clearance rate

The Sydney home auction market has bounced back hard by recording its highest clearance rate since June last year, at the height of the then-record boom in house price growth.

Sydney recorded a stunning clearance rate of 85.1 per cent on Saturday, which was well ahead of the previous weekend’s surprisingly-low result of 77.1 per cent and, remarkably, nearly 15 per cent higher than the 71.3 per cent recorded over the same weekend last year.

Although growth rates are unlikely to match last year’s record levels, prices will nonetheless prove more headaches for local first home buyers struggling to get into the market.

The Australian Bureau of Statistics data showed first-home buyer loans in NSW have fallen by 4.6 per cent over the first seven months of this year compared to the same period a year ago, with estimates of five years of savings from average incomes now required to get into the market – at today’s house prices.

Sydney has now recorded five weekends out of the past six with clearance rates at or above 80 per cent, with the early spring market a bonanza for sellers. This in sharp contrast to last spring when rates fell backwards steeply to well below 70 per cent, as the market was dampened by higher mortgage rates.

A shortage of auction listings is contributing to higher clearance rates, with buyers competing fiercely for available stock. Just 567 auctions were conducted on Saturday, which was similar to the previous weekend’s 565 and again well below the 832 conducted over the same weekend last year.

Just 1682 homes have been auctioned in Sydney over September weekends so far, which is 802 fewer than the same period last year – a fall of 32.2 per cent.

Sydney’s regions produced some extraordinary results at the weekend, with three areas recording clearance rates above 90 per cent. The top performer was the booming upper-north shore with 91.9 per cent, closely followed by the south with 91.7 per cent, the inner west with 90.8 per cent and the highest sales at 69, the northern beaches with 89.3 per cent, the city and east with 86.3 per cent, the lower north with 83.9 per cent, the west with 80.8 per cent, the north-west with 80 per cent, the south-west with 76.5 per cent, Canterbury Bankstown with 71.4 per cent and the central coast with a clearance rate of just 37.5 per cent.

Notable sales reported at the weekend included:

• a five-bedroom home at 3 Lower Wycombe Road, Neutral Bay, sold by McGrath Neutral Bay for $7.25 million;
• a five-bedroom home at 1 Northcote Road, Lindfield, sold for $4.3 million by McGrath Lindfield;
• a five-bedroom home at 142 Homebush Road, Strathfield, sold for $4.2 million by Devine Real Estate;
• a three-bedroom home at 43 Liverpool Street, Paddington, sold for $3,325,000 by PhillipsPantzer Donnelley;
• a five-bedroom home at 55 Dorking Road, Cabarita, sold by Devine Real Estate for $3.03 million.

The most expensive property reported sold at auction at the weekend was a eight-bedroom home at 2 Llandilo Avenue, Strathfield, which sold for $7.3 million by Strathfield Partners. The most affordable property reported sold at the weekend was a two-bedroom home at 29 Rolfe Avenue, Kanwal, which sold for $360,000 by Sorensen Real Estate.

For a list of Sydney weekend auction results click here.

Sydney recorded a median auction price of $1,221,000 on Saturday, which was slightly lower than the $1.26 million recorded the previous weekend. Saturday’s median was also 13.1 per cent higher than the $1.08 million recorded over the same weekend last year. A total of $380.7 million was reported sold at auction in Sydney at the weekend.

Dr Andrew Wilson is Domain Group chief economist Twitter@DocAndrewWilson join on LinkedIn