Sydney stable, Melbourne wobbly

Despite the revival in the clearance rate at the weekend, the underlying trend has weakened over the past month although it is nonetheless remaining strong and definitely still a sellers’ market. Sydney’s four-weekend average clearance rate now stands at 81.3 per cent compared with 83.0 per cent over the previous four-weekend period.

This weekend the Sydney home auction market will again host high auction numbers with 740 homes scheduled to go under the hammer. This is higher than last weekend’s 704 and clearly ahead of the 691 auctioned over the same weekend last year – and another big test for the resilient local market.

The inner west will again clearly host the largest number of auctions this weekend, with 134, followed by the city and east with 111; the south, 94; the upper north shore, 88; the lower north, 75; the west, 52; Canterbury Bankstown, 50; and the south west, which has 44 auctions scheduled.

The most popular suburbs for auctions this weekend in Sydney are Paddington in the city and east, and St Ives on the upper north shore, each with 11 auctions listed. These are followed by Bexley in the south and Baulkham Hills in the north west, each with 10, and Surry Hills and Randwick, both in the city and east, and Epping and Pymble both on the upper north shore and all with 9 auctions scheduled this weekend.

Latest house price data from APM Pricefinder, meanwhile, indicates that Sydney’s housing market clearly remains the best performer of all the capital cities.

Sydney’s median house price increased by 3.8 per cent over the September quarter to a new record $843,994. The median house price is now up by 16.6 per cent over the past year, representing a rise of $120,466.

Sydney’s unit prices also increased over the September quarter, according to APM Pricefinder, up by 1.6 percent to $580,861 for an increase of 11.5 per cent over the year. The median unit price in Sydney now exceeds the median house prices of Adelaide, Brisbane, Hobart and Canberra and is closing in fast on Melbourne and Perth house prices.

This weekend, Melbourne will smash the local record for the number of auctions conducted on a Saturday. Over 1,500 properties are scheduled to go under the hammer - well ahead of the previous metro area record of 1,365 - set, coincidently, on the same weekend last year.

The weekend before the Melbourne Cup holiday long weekend is traditionally one of the biggest days for auctions on the Melbourne calendar since sellers avoid a clash with the big race.

This weekend’s unprecedented efforts will test the local market to the full, with recent signs of a weakening in buyer activity.

The Melbourne weekend home auction market lifted last weekend following two weekends of falling clearance rates. Melbourne reported a 76.4 per cent clearance rate compared to the previous weekend's 73.8 percent - the lowest result so far this spring.

Despite that rise, the recent underlying trend has been to fall. The four-weekend average clearance rate now stands at 75.9 per cent compared with 77.4 per cent over the previous four-weekend period. Current clearance rates, however, continue to reflect solid local market conditions, with competition among buyers an encouraging trend for sellers.

Melbourne’s inner city will host the largest number of auctions this weekend, with 208, followed by the inner south, with 186; the inner east, with 181; the west, 170; the north east, 152; the outer east, 115; the north, 70; and the south east, with 44.

The most popular suburbs for auction listings this weekend in metro Melbourne are Glen Iris and Hawthorn, both in the inner east, and Richmond in the inner city, each with 26 auctions scheduled.

These are followed by St Kilda in the inner city, North Balwyn in the inner east and Brighton in the inner bayside area, each with 22 auctions listed, and Glen Waverley in the outer east, South Yarra in the inner city, Brunswick in the north and Reservoir in the north east, all with 21 auctions scheduled this weekend.

Latest data from APM Pricefinder indicates that the Melbourne median house price increased by just 1 percent over the September quarter – the lowest result in the series for two years.

Melbourne’s weakening house price performance over the September quarter was reflected in other major capital city markets, which consistently reported falling house prices as the impact of the historically low interest rates of the past year diminishes.

The standout exception was Sydney, where price growth remains strong and is trending upwards, although not at the 'boom time' rates of a year ago.

Although price growth is moderating in Melbourne, the local auction market remains largely in favour of sellers. This weekend will reveal whether surging supply can still be matched by recent solid buyer demand.