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The Australian property market has avoided the impact of the coronavirus, with high volumes of sales and strong clearance rates, the latest data has suggested.
According to stats released by CoreLogic, preliminary auction clearance rates were 70.6 per cent for the week concluding Sunday, 15 March, as 2,220 homes were taken to auction for the combined capital cities.
Final auction clearance rates are likely to fall below 70 per cent for the second straight week, following a clearance rate of 68.6 per cent last week.
With uncertainty rising and confidence slipping as the coronavirus outbreak becomes more widespread, there is some downside risk that housing activity will reduce, which could weigh on auction markets over the coming weeks.
However, based on the early auction results this week, the housing market has proven to be relatively resilient so far.
State-by-state breakdown
In Melbourne, a preliminary auction clearance rate of 70.1 per cent was recorded across 1,173 auctions this week, while last week there were 418 auctions, returning a final clearance rate of 66.1 per cent.
There were 749 auctions held in Sydney this week, returning a preliminary clearance rate of 74.6 per cent. In comparison, there were 830 auctions held over the previous week and the final auction clearance rate was 75.2 per cent.
Brisbane held 102 auctions, with a preliminary clearance rate of 51.7 per cent, while Adelaide had 99 auctions with 68.4 per cent being sold.
In the country’s west, Perth had 28 auctions with 57.1 per cent being sold, while the nation’s capital had a preliminary clearance rate of 69.4 per cent.
The strong gains in Tasmania look set to continue, with lower volumes again leading to a high clearance rate of 83.3 per cent.
Caution advised
Despite auction volumes holding strong, REIA president Adrian Kelly recently issued a statement, prompting agents to prepare for what could eventuate as a result of the coronavirus outbreak.
Mr Kelly noted: “It is more likely our markets will be affected by reduced consumer sentiment than the actual virus itself. I am already hearing of many stories whereby potential vendors are deciding not to sell at this time, preferring to wait until things normalise.
“While such a notion is completely understandable, it doesn’t make sense as we all know it is better to sell in a market with less competition, and I have no doubt that our buyers will continue to purchase regardless of how the seller may be feeling.
“I suspect any reduced consumer sentiment is likely to be magnified in the larger cities than in regional parts of Australia, just as the nonsensical rush to buy toilet paper has been.
“I have no doubt that once this situation is managed and under control, our markets will return to normality, just as they did after the bushfires earlier in the year.”
ABOUT THE AUTHOR
Emma Ryan
Emma Ryan is the deputy head of editorial at Momentum Media.
Emma has worked for Momentum Media since 2015, and has since been responsible for breaking some of the biggest stories in corporate Australia, including across the legal, mortgages, real estate and wealth industries. In addition, Emma has launched several additional sub-brands and events, driven by a passion to deliver quality and timely content to audiences through multiple platforms.
Email Emma on: Emma.Ryan@momentummedia.
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