Auction rates continue to take a battering

Property data provider CoreLogic has revealed that in the week ending 12 April, there was a preliminary auction clearance rate of only 29.3 per cent.

The clearance rate was dragged down by a withdrawal rate of 57 per cent. Of the sold results last week, 63 per cent sold prior to the scheduled auction date, according to CoreLogic.

The Property Market Indicator Summary for the week ending 12 April outlined that while it is not unusual to see low volumes over the Easter week (as it is typically one of the quietest weeks of the year), the market continues to bear the brunt from social distancing measures banning on-site auction to contain the spread of the coronavirus.

“[T]he clearance rate is the lowest preliminary result recorded since CoreLogic commenced auction reporting in 2008,” the summary said.

“It’s likely as more results are collected that the final clearance rate will come in even lower and withdrawal rates higher.”

Across the combined capital cities, only 636 homes were scheduled for auction over the Easter week, with 472 results collected so far.

A total of 1,976 homes were taken to auction in the corresponding period last year, with a clearance rate of 52.6 per cent.

Sydney took the 410 properties to auction last week, the highest number of homes out of all the capital cities, and returned a preliminary clearance rate of 31.1 per cent.

Melbourne took only 92 homes to auction, returning a preliminary clearance rate of just 16.7 per cent. This is in stark contrast to the corresponding period last year, when 892 homes were taken to auction, with a clearance rate of 55.4 per cent.

Both Brisbane and Adelaide took 40 homes to auction, returning preliminary clearance rates of 21.9 per cent and 30.0 per cent, respectively.

Canberra took 42 homes to auction with a clearance rate of 43.5 per cent, while Perth took nine homes to auction with a clearance rate of 50.0 per cent.

Looking forward, the property research group expects that the withdrawal rate will lessen as fewer auctions are scheduled, with vendors favouring private treaty methods of sales, or preferring to postpone their listing until some certainty returns to the economy and the market.

Last week, CoreLogic reported that for the week ending 5 April, 45 per cent of auctions were withdrawn from sale prior to auction.

That was the second week of record-breaking withdrawal rates, with the week prior seeing 50 per cent of auctions withdrawn from sale.

[Related: Auction clearance rates spike year-on-year]

Malavika Santhebennur is the features editor on the mortgages titles at Momentum Media.

Before joining the team in 2019, Malavika held roles with Money Management and Benchmark Media. She has been writing about financial services for the past six years.