The health of Australia’s housing market again proved resilient on the weekend with clearance rates holding strong despite record numbers of home auctions in Melbourne and Brisbane.
In Sydney where there were 911 listed auctions, clearance rates remained steady at 75 per cent according to APM PriceFinder, marginally down on last week but generating some big sales, including a seven bedroom house at Strathfield in Sydney’s inner west which sold for $5.7 million or about $1.2 million over its reserve.
Devine Real Estate’s Aaron Papadimatos, who sold the property at 9 South Street said the bidding was competitive and that some bidders also attended a nearby auction where the property sold for $4.6 million also well above owner’s expectations.
“It’s still very strong out there,” he said.
Domain chief economist Andrew Wilson said the inconsistency in the Sydney market was something to watch.
“The lower northern beaches saw a huge clearance rate of 92 per cent, but western Sydney is the other end of the pineapple with clearance rates still at 40 per cent.”
In stark contrast, Mr Wilson said Melbourne had shown superb consistency with only 10 per cent difference in clearance rates between the highest and lowest priced homes for sale.
The clearance rates achieved a very healthy 74 per cent, down from 76 per cent last week.
The most expensive property sold was a five bedroom house in Windsor selling for $4.85 million.
In Brisbane a record 179 auctions took place but with only 30 per cent of the results reported Mr Wilson said the 40 per cent clearance rate was not indicative of a truly representative result.
“Brisbane is a steady market. The city has never had a strong auction culture and usually has a clearance rate of about 50 per cent.”
The most expensive property sold was a four bedroom house with pool and big backyard at Camp Hill for $1.42 million.
Darcy Lord from agency Place who sold the property at 56 Henderson Street said it fetched a price of $20,000 more than reserve after eight registered bidders.
Brisbane has a much higher degree of relative affordability than Sydney and Melbourne – that is the value difference compared to the income of the city’s resident.
However a new survey commission by the Commonwealth Bank of Australia shows that prospective Australian home buyers are likely to overvalue properties in their capital city.
In Brisbane 49 per cent of respondents were likely to overvalue properties second highest only to Sydney where 57 per cent of respondents were likely to overvalue.
The Commonwealth Bank’s executive general manager of home buying Dan Huggins said buyers needed to be better informed.
“Discussing the local property market is a national pastime but these results show that, even for those actively looking to buy a property, perception can be different to reality.”
The bank has recently launched a new CommBank Property app to help new home buyers inform themselves of the market.