The property clearance rate crept higher again across capital cities this weekend, as experts shrug off suggestions the spring market will not reach full bloom this year.
The national clearance rate has remained unseasonably strong for winter, rising to 69.7% off the back of 1,467 auctions this weekend, up from 67.3% last week, according to RP Data.
Property analyst Louis Christopher, from SQM Research, said he didn’t put stock in predictions the spring market may be smaller than usual.
Christopher says there will be just as many buyers around, but the number of listings should swell.
“Clearance rates will fall and commentators will say there has been a slow down,” says Christopher.
He says comments pointing to a price growth “slow down” are inaccurate, and it is more likely the market was just experiencing a natural seasonal lull.
“The market has still got a lot of momentum,” he says, pointing to a tempo of a 7% rise in national property prices. That tempo has hit 15% in Sydney, according to Christopher.
RP Data spokesman Robert Larocca agrees there is no evidence of a slowdown, said this morning that all indications show spring volumes will be larger in volume than a year ago.
At the weekend, Sydney’s auction market again performed outstandingly, with a clearance of 77.6% as 583 properties went under the hammer.
Melbourne cleared 70.9% of its 637 auctions.
Larocca says the weekend’s results were a good sign for the Melbourne market, which has been playing second fiddle to Sydney’s auction strength.
“Last week Melbourne dragged the national clearance rate down, but this week it contributed substantially, and that bodes well for those in Melbourne,” says Larocca.
Adelaide had a clearance of 60.3% on 94 auctions, while Brisbane preformed woefully, with a 32.3% clearance on 96 properties.
A review of volumes nationally over the first eight months of the year shows there have been nearly 50,833 capital city auctions in total, or 38% more auctions held when compared to the same period last year, according to RP Data.
Christopher shrugged off commentators saying buyers are showing signs of resistance to higher prices at the end of an 18-month upturn.
“They were saying that two years ago. Buyers will always be unhappy about prices,” he says.
Christopher predicts spring listings will be strong but says it will be interesting to compare the numbers to that of last year’s strong season.
Larocca says the growth is more moderate than levels associated with the 2007 and 2010 cycles.
“I remember in 2010 and 2007, buyers were complaining about prices rising in front of their eyes. They are less likely to be surpassed by rising prices now [than back then],” he says.
Just like I predicted in June, Melbourne and Sydney will boom into 2015. It will cool off in 8-9 months but the upcoming spring/summer sale period will be enormous and will exceed YOY gains over the last 12 months. Melbourne in particular will be feverish, I can foresee 15-20% rise YOY.
Sydney will perform well but remain at 12-15% YOY.
Every auction I have driven past in the last 3-4 weeks has had 50-100 in attendance. It seems their are 3-5 buyers for every property that is sold, that's hundreds of people every week in each state that still want/need to buy.
That sort of activity doesn't just disappear nor is it conducive to a 'buyers' or cooling market.
Money supply is growing well and there is momentum in the property sales which will continue for some time. It is pretty stupid to create a housing boom with record low interest rates, guess the RBA doesn't know what to do, if we didn't have all this house price growth, economic activity would be even worse. It's like when the GFC came, they committed themselves with determination not to allow house price deflation at any cost, they are still having nightmares about it.
it s going to be a red hot spring. I was thinking of putting an offer on a 3br in my street (almost the worst house), did not sell last year with asking price of 565k, sold this morning for 660k !! ( no reno,nothing, just an open Saturday.SE QLD.
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