Sydney auction market back to near-record listings

Sydney’s record-breaking winter auction market ends this weekend with yet another extraordinary Saturday of listings.

Vendors have flooded the market this month to take advantage of still strong market conditions for the end of winter. Sydney will host 800 auctions on Saturday – just behind the August record of 847 set three weekends ago. 

This weekend’s auctions are well ahead of last weekend’s 724 listings and the 583 conducted over the same weekend last year. Nearly 3800 weekend auctions were listed for auction in August compared with 2301 last year.

Sydney’s inner west will again host the most auctions this weekend with 115 followed closely by the south with 113, the upper north shore 110, city and east 83, the south-west 80, the lower north 79, the west 61, Canterbury-Bankstown 57,  the north-west 41, the northern beaches 37, and the central coast with 24 auctions.  

The most popular suburbs this weekend are Blacktown and Mosman, each with 13 followed by Liverpool with 11, Surry Hills 10, Bankstown and Mortdale each with nine auctions and Epping, Marrickville and Yagoona each with eight auctions.

Sydney’s late winter auction market has faded as record supply began to match underlying demand with buyers now offered more choice. Sydney reported a clearance rate of 76.4 per cent last Saturday – down from the 79.7 per cent recorded the previous weekend and well below the 83.4 per cent recorded over the same weekend last year.

The previous weekend’s bounce-back result proved to be short-lived with the monthly clearance rate trend clearly falling. The market is now tracking in the opposite direction to a year ago when clearance rates were rising sharply above 80 per cent. Sydney has recorded five consecutive weekends with rates below 80 per cent.

Recent regional trends have indicated a weakening in clearance rates in the lower price range areas to the west and south west of Sydney reflecting perhaps a softening of investor demand for properties in these regions.  Auction clearance rates in Sydney’s booming north-west have also been lower recently.

Next week the Reserve Bank will meet to determine the direction of official interest rates for September. Rates have been on hold for the past three months and are most likely to remain at the current 50 year low of 2 per cent next month. 

The bias for interest rate direction over the short term has however changed sharply over the past month with unemployment levels spiking over July back to 12-year highs and turmoil in global equity markets reflecting concerns over the declining performance of the China economy.

The Reserve Bank has also conceded that national underlying economic growth may now be lower than previously expected. If unemployment fails to improve over coming months, another cut in rates will occur sooner rather than later – particularly as dark clouds are now clearly gathering over the global economy.

Dr Andrew Wilson is Domain Group Senior Economist Twitter @DocAndrewWilson
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