Sydney auction clearance rate below 50 per cent for fourth week

Property market watchers warned that Sydney was in a “two-speed market” at the weekend as vendors in the outer-western suburbs struggled to find buyers.

On Saturday, Domain data revealed a weekend auction clearance rate of 44 per cent from 334 reported auctions.

It was the fourth consecutive week the rate was below 50 per cent. More vendors were also not proceeding with booked auctions, with 170 properties out of a total auction list of 643 homes on Saturday withdrawn.

Buyer’s agent Peter Kelaher, of PK Property Search & Negotiators, said the market was operating at two speeds.

It was tough for sellers in the western suburbs to find buyers, and their properties averaged 72 days to sell. By contrast, properties within 10 kilometres of the city that offered all the features of an A-grade property were “selling within their auction campaigns for good, but not great, prices”.

Sydney’s median house price fell 6.5 per cent over the year to September, but Domain data shows that the market is one of ups and downs, with 99 suburbs actually recording price gains during this period.

Some smaller houses with little scope for expansion struggled to sell on Saturday, despite agents being candid about asking prices.

The Property Sellers widely promoted the $1.25 million guide price of a renovated art-deco home with two bedrooms in Marrickville, but the property received no bids at auction.

Selling agent Jonathan Ford said his agency had been “really transparent” about the expectations for 38 Despointes Street, but potential buyers held back.

He said there was not much buoyancy in the inner-west’s two-bedroom house segment, and the “the last good strong results” for the wider market were in June.

“It is all about doing deals,” Mr Ford said.

“Buyers go in with the money, and sales depend on the vendor’s willingness to accept offers. But it is a really good market to be buying up in. If you are paying $2.5 million for a house, and are selling at $1.5 million, and the market is down by 10 per cent, you are making up some pretty good money there.”

The most expensive house reported sold on Saturday was a five-bedroom, mid-century house at 2 Coolawin Road, Northbridge. The waterfront property with a deep-water jetty was sold on Saturday for $4.81 million by Sotheby’s Realty.

Other notable sales included a house at 69 Lower Fort Street, Dawes Point. This home sold for $3.051 million through McGrath Eastern Suburbs, while a house at 22 Bathurst Street, Woollahra, fetched $2.725 million through Phillips Pantzer Donnelley.

For vendors, the market is entering a high-pressure phase. Historically, more properties are listed for sale in November and December compared to early spring. This can ratchet up the pressure on sellers to accept lower-level offers because, if they don’t sell before Christmas, chances are they will not negotiate a transaction of their property until late February or March.

Buyer’s agent Paul Osborne, from Secret Agent, said the east coast capitals were “at the end of the easy growth across the board” notched up over much of the past 20 years, because official interest rates couldn’t go any lower.

“Credit availability is difficult and getting worse,” he said. “You’ve also got the psychological element dripping through to the whole market.”

Kelaher believes property bargains in select areas will be on offer in the run-up to Christmas.

“Vendors and agents will be motivated to sell to avoid coming back on the market again next year, in what will be an uncertain market in specific areas,” he said.