Melbourne auctions come to standstill

Data from the property research group for the week ending 6 September has revealed that there were only 28 homes taken to auction last week.

“The lower activity is not overly surprising given the city has been in stage 4 lockdown for the past five weeks, meaning both on-site auctions and private inspections are currently banned in Melbourne,” CoreLogic’s property market indicator summary said.

Of the 24 results collected so far, only 33.3 per cent were successful, with all but one sold prior to the auction event.

Two-thirds of auctions were withdrawn in Melbourne last week, further dragging down the clearance rate.

Over the previous week, the city was host to 162 auctions, while this time last year there were 765 homes taken to auction.

Nationally, the number of auctions dropped to 882 last week, compared with 1,128 homes during the previous week, and 1,533 this time last year.

Of the 696 results collected so far, 67.5 per cent were successful, slightly lower than the previous week’s preliminary figure of 67.7 per cent, which later revised down to 59.8 per cent at final collection.

Over the same week last year, a final clearance rate of 72.3 per cent was reported across the combined capital cities.

Last week, there were 625 auctions in Sydney, down from 706 the previous week and 528 this time last year.

Of the 491 auction results collected so far, 69.5 per cent were successful, down from the previous week’s preliminary result of 74.0 per cent, later revised down to 64.2 per cent.

This time last year, Sydney’s final clearance rate was 75.7 per cent.

Across the other capital cities, Canberra recorded the highest preliminary clearance rate of 78.6 per cent across 70 auction results, followed by Adelaide with a preliminary clearance rate of 69.0 per cent across 42 results.

There were 64 auctions in Brisbane, recording a preliminary clearance rate of 60.0 per cent, while in Perth, there were only 20 auctions, with a preliminary clearance rate of 26.7 per cent.

The lockdown has impacted the number of new property listings in Melbourne as well, which saw a 76.1 per cent 12-month drop, with only 1,468 new listings over the past 28 days.

This compares to a 0.6 per cent gain in Sydney, where 6,061 new properties came on to the market.

Housing finance activity

The lockdown has also had an adverse effect on mortgage activity in Victoria, with the index value recording an 8.9 per cent decline to 108.9.

Western Australia was the only other state to record a month-on-moth decline in mortgage activity, dropping by 1.9 per cent.

Nationally, mortgage activity rose by 0.1 per cent, with Tasmania recording a 14.6 per cent increase, while NSW recorded a 4.7 per cent increase.

Meanwhile, activity increased by 3.3 per cent in South Australia and 1.9 per cent in Queensland.

[Related: Stalled migration to hammer housing demand]

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.