National Media Release

RP Data Weekly Property Pulse
Released: Thursday 11 July 2013

Auctions becoming more popular
RP Data researcher Cameron Kusher this week undertook an analysis of the number of properties sold by auction around the country over the first quarter of 2013. Coinciding with the stark improvement in clearance rates throughout 2013, the analysis shows a sharp rise in auction sales. Mr Kusher said, “We’ve seen a significant improvement in auction clearance rates across the combined capital cities over this year, combined capital city auction clearance rates have been recorded at an average of 63.3 per cent over the year.” Throughout 2011 and 2012, clearance rates recorded much lower averages at 47.2 per cent and 50.2 per cent respectively while over the same period, capital city home values fell by -3.8 per cent and -0.4 per cent respectively. Capital city home values increased by 3.0% over the first six months of 2013. “Overall, this represents a turnaround in fortunes for the housing market over the past six months. “An interesting feature worth noting for this year is the increase in the number of properties going to auction.

Rolling 4 week average combined capital city auction clearance rate
90.0% 80.0%

70.0%
60.0% 50.0% 40.0%

30.0%
20.0% 10.0% 0.0% Jun-08

Dec-08

Jun-09

Dec-09

Jun-10

Dec-10

Jun-11

Dec-11

Jun-12

Dec-12

Jun-13

Source: RP Data

Weekly number of combined capital city auctions
3,000 2,500 2,000 1,500 1,000

“Obviously if auctions are proving to be more successful, vendors will be more inclined to sell their homes by this method,” Mr Kusher said.
On a week-to week basis, 1,445 auctions have taken place this year while for the same period back in 2012, there was an average of 1,334 auctions each week and in 2011 the average was 1,384 auctions. Based on these figures, Mr Kusher said that there are about 100 more capital city auctions each week and the likelihood of selling at auction has increased from around a 50:50 chance to a better than 60:40 chance. “With a rising auction clearance rate it is interesting to look at the proportion of successful auction sales across the combined capital cities, compared to sales by private treaty. Over the first quarter of the year, 14.3 per cent of all sales across the combined capital cities were transacted by auction. The figure highlights that the vast majority of homes are sold by private treaty sales however, auction sales have risen from 10.5 per cent of all sales over the first quarter of 2012,” Mr Kusher said. Across the individual capital cities there have of course been some variances in the proportion of sales. Melbourne and Sydney have the most substantial auction markets of all Australian capital cities. Over the first quarter of 2013, 25.2 per cent of all Melbourne sales were by auction, up from 15.8 per cent over the March quarter of 2012. The proportion of successful sales by auction across Sydney has also risen over the past year. Over the first quarter of 2012, 13.4 per cent of all sales across the city were auctions. In comparison, 16.1% of all sales over the first quarter of this year were auction sales. Overall the data highlights that as the auction clearance rate has improved so too has the proportion of properties going to auction, particularly within Sydney and Melbourne. Although auction volumes have risen, the vast majority of home sales continue to be completed via private treaty. Auction clearance rates are now hovering around levels last seen three years ago. Values over the past year have increased by 3.8 per cent in comparison to annual growth of around 13 per cent last time clearance rates were this high.

500
0 Jun-08

Dec-08

Jun-09

Dec-09

Jun-10

Dec-10

Jun-11

Dec-11

Jun-12

Dec-12

Jun-13

Source: RP Data

Proportion of capital city homes sold by auction over the first quarter of each year
2013
2012 2011 2010 14.3%

10.5%
11.2% 12.5% 5.7%

2009 2008
0.0% 5.0%

8.3%
10.0% 15.0% 20.0% 25.0% 30.0%
Source: RP Data

Proportion of individual capital city homes sold by auction over the first quarter of 2013
Melbourne
Sydney 16.1% 9.2% 9.2% 4.7%

25.2%

Adelaide
Canberra

Brisbane
Darwin Perth Greater Hobart 0.0% 1.1%

2.8% 0.9%
5.0% 10.0% 15.0% 20.0% 25.0% 30.0%
Source: RP Data

DISCLAIMER In compiling this publication, rpdata.com has relied upon information supplied by a number of external sources and RP Data does not warrant its accuracy or completeness. To the full extent allowed by law RP Data excludes all liability for any loss or damage suffered by any person or body corporate arising from or in connection with the supply or use of any part of the information in this publication. RP Data recommends that individuals undertake their own research and seek independent financial advice before making any decisions. © 2012 RP Data Ltd.

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