A clearly strengthening home auction market in Sydney at the weekend has set the tone for a positive late autumn performance.
Although higher-priced inner suburban regions generally continue to produce the best results, the market has shown some early signs of evening out recently with more buyers now active in the outer suburbs.
The Sydney housing market reported a clearance rate of 73.8 per cent on the weekend, the highest result for the local market since the Easter break six weekends ago.
Saturday’s rate was higher than the 73.1 per cent recorded over the previous weekend but well below the boom-time 89.1 per cent recorded over the same weekend last year.
The improved weekend result was recorded despite high listings – 672 homes were scheduled to go under the hammer on Saturday which was well ahead of last weekend’s holiday-affected total of 426 and the second-highest day of auctions this year so far.
The most expensive property auctioned at the weekend was a six-bedroom home at 65 Wharf Road, Gladesville, which was sold for $7,095,000 by McGrath Hunters Hill.
The most affordable property reported sold at the weekend was a two bedroom home at 6 Moss Avenue, Toukley, sold for $345,000 by Professionals 2261.
Sydney recorded a median auction price of $1,152,000 on Saturday which was higher than the $1,100,000 recorded last weekend. Saturday’s median remained 15.7 per cent higher than the $995,500 recorded over the same weekend last year.
A total of $403.8 million was reported sold at auction in Sydney at the weekend.
The city and eastern suburbs continue to produce strong results for sellers, and recorded the highest clearance rate at the weekend with 91.9 per cent and the highest number of sales at 68.
All eyes will be on the federal budget this week, with housing markets sensitive to outcomes in regard to spending initiatives or possible public service job and service cuts, and changes to taxation policy.
Tuesday’s budget will coincide with the monthly decision on official interest rates settings from the Reserve Bank with the case clearly growing for a cut.
The peak of the home building cycle appears to have passed and concerns regarding overheating housing markets are now clearly fanciful, with Sydney house prices falling sharply over the past six months.
Although the jobless rate has improved recently, this measure tends to be a lagging indicator of economic health and recent improvements have largely come from increases in part-time work.
Latest weak inflation data clearly reflects a stagnating economy.
The Reserve Bank may cut rates on Tuesday in a bid to support a weakening economy.
This would be a pre-emptive strike before the banks universally raise them.
If it does, it would avoid the distraction of the election campaign, to begin in earnest once Treasurer Scott Morrison hands down the budget.
For a full list of the Sydney auction results Click here
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Dr Andrew Wilson is Australia’s leading housing market expert. As senior economist for Fairfax-owned Domain Group, Dr Wilson is one of the nation’s most respected real estate analysts and Australia’s highest profile housing market commentator. Visit his blog at Domain