Sydney spring market steaming ahead fueled by low rates

The Sydney spring home auction market continues to steam ahead with sellers benefiting from still relatively low listing numbers and buyer confidence fuelled by low interest rates.    

Just over 550 homes are listed to go under the hammer on Saturday, which will be a little more than the 537 auctioned last weekend. And this weekend’s auction activity will again remain well below last year’s 837 listings recorded over same weekend.

The Sydney market has reported a drop of 5286 weekend auctions so far this year compared to the same period last year – a decrease of 25 per cent.

The upper north shore is the most popular region in Sydney this weekend for auctions, with 93 listed, followed by the inner west 81, the city and east 63, the south 55, the northern beaches 50, the lower north 45, the west 42, the south west 41, Canterbury Bankstown 36, the north west 32 and the central coast with 10 auctions scheduled on Saturday.  

Manly is the most popular suburb in Sydney for auctions this weekend with 10 followed by Mosman and Wahroonga each with nine, Maroubra, Baulkham Hills and Earlwood each with eight, Epping with seven and several with six auctions listed including Blacktown, Alexandria and Lane Cove.

The red-hot Sydney housing market celebrated the official start of the spring selling season last Saturday with yet another strong auction result. 

Sydney recorded a clearance rate of 80 per cent last weekend, which, although marginally lower than the previous weekend’s 80.7 per cent, remained significantly higher than the 75.1 per cent recorded over the same weekend last year.

Sydney has now recorded four consecutive weekends with clearance rates at or above 80 per cent, with the local market performing at its highest level since July last year.

Strong auction market conditions are being shared by most of Sydney’s regions with the recently subdued outer suburbs now recording significantly higher results than earlier in the year.

Strong buyer activity is being fuelled by historically low interest rates and solid competition amongst banks for mortgage customers. 

The Reserve Bank met this week for its monthly decision on the direction of official rates with rates predictably to be left on hold over September following last month’s cut to a new record low 1.5 per cent.

The bank will await the impact of last month’s cut to assess if further cuts are required, however latest economic data remains underwhelming with the likelihood of yet another rate cut later in the year, particularly if the labour market deteriorates and inflation continues to decline.

Dr Andrew Wilson is Domain Group’s chief economist

Twitter @DocAndrewWilson