As Sydney’s auction market slumps, the suburbs recording some of the city’s weakest recent clearance rates have been exposed.
Pressure persisted across Sydney’s auction market last week, with only 39 per cent of scheduled auctions resulting in a sale, according to PropTrack data.
This comes as new realestate.com.au data has spotlighted some of the softest-performing areas.
It was Sydney’s Northern Beaches that saw the lowest clearance rate of 26 per cent.
Among the weakest results were the Eastern suburbs, Central Coast and South West (30 per cent), followed by Baulkham Hills and Hawkesbury (38 per cent).
MORE: Sydney prices hit as sellers shrink from auctions
New data has revealed some of Sydney’s prestige markets are seeing the lowest clearance rates. Pictured Auctioneer Clarence White at a Bondi auction. Picture: Sam Ruttyn
REA Group senior analyst Megan Lieu said lower clearance rates generally signal a misalignment between buyer and seller expectations.
“In these areas (top five lowest), sellers may be slower to adjust expectations to market conditions,” she said.
“Notably, the two regions with the lowest auction clearance rates are among the most expensive in the country.
“Premium markets often respond earlier to shifts in sentiment and demand which may be contributing to more modest auction figures.”
Ms Lieu noted Sydney’s auction clearance rates have fallen from around 45 per cent pre budget week, to 41 per cent in the week ending July 5.
“At the same time, total auction numbers over the past month have been declining,” she said.
“As market conditions soften and clearance rates ease, sellers may be becoming less inclined to favour auctions as a sales method.”
Sydney’s Eastern Suburbs saw the second lowest clearance rates last week, according to new data. Picture: NCA NewsWire / Gaye Gerard
LJ Hooker head of research Matthew Tiller said overall auction clearance rates are softer in the market with uncertainty driven from tax policy changes, higher interest rates to cost of living pressures.
According to Mr Tiller, the areas that have seen the lowest results last week sit within the higher valued prestige markets.
“The similarities between those regions that have experienced softer than normal clearance rates is that they do sit within that higher mortgage areas,” he said.
“With the level of interest rates at the moment, there’s a little bit of pressure on borrowing capacity and serviceability of mortgages so mortgage affordability is quite low.
“It’s putting pressure on some of those kind of more prestige markets.”
Auctioneer Clarence White of Menck White Auctions said market weakness was across the board.
“Everything is pretty tough everywhere,” he said.
“The eastern suburbs is notorious for selling prior, so a very significant percentage of those cleared auctions that you would have in the eastern suburbs at least, it would have been sold prior rather than gone to auction.”
English (US) · 