CoreLogic has released its final auction results for last weekend, with the nation’s clearance rate plummeting to just 54.8% – the lowest result since late July 2020 during the depths of the pandemic:
Auction clearances were weak everywhere other than Adelaide.
According to CoreLogic:
Continuing the downward trend seen since midFebruary, last week’s combined capitals clearance rate fell to its lowest level since late July 2020 (54.1%), when Melbourne was experiencing its second COVID wave. With 54.8% of auctions held reporting a successful result, last week’s clearance rate was 3.3 percentage points below the previous week’s rate (58.2%) and well below the rate recorded this time last year (73.6%)…
Down 6.4 percentage points from the previous week (58.8%), last week’s [Melbourne] clearance rate marked the lowest rate since early September 2021 (43.8%), with 52.4% of last week’s auctions returning a successful result. This time last year 68.8% of auctions held were successful…
After recording the lowest clearance rate since April 2020 (50.9%) the week prior (53.3%), Sydney’s clearance rate rose one percentage point last week to 54.3%. This time last year, 74.1% of the 745 auctions held were successful…
With interest rates on the rise and consumer sentiment continuing to fall, it’s likely the clearance rate will continue to reflect the challenging selling conditions.
Auction clearance rates have traditionally been a good leading indicator for house price growth across Sydney and Melbourne.
Thus, the plunge in clearance rates across both markets is pointing to accelerating price falls:
The great house price correction has well and truly begun.
How deep it goes will depend on how aggressively the Reserve Bank hikes interest rates.
