The property market research group, Cotality, has tabulated the final results from the weekend’s home auctions and found that clearance rates have only been this low three times in the past 15 years.
The final average clearance rate across the nation came in at 42.3%, 6 percentage points lower than the week before and 6.2 percentage points lower than the corresponding weekend a year ago.
“The last time clearance rates fell to this level was 26 April 2020 (41.1%) a time when the Australian auction market was substantially disrupted by strict social distancing policies and a sharp deterioration in market confidence, resulting in a breakdown in normal auction activity,” Cotality economist Annabelle Mezieres said.
“The downward trend in clearance rates has been apparent since mid-February, but a sub-50% reading indicates a wide gap has opened between buyer and seller pricing expectations.
“Since the commencement of Cotality’s auction results in 2008, clearance rates have been this low across only three periods previously: in 2011 and 2018 as the housing market was navigating a downturn, and during the early onset of the COVID-19 pandemic when the auction dynamic was severely disrupted.
“Additionally, the 4-week rolling average indicates that the weighted average clearance rate is trending downward, suggesting the decline is not merely due to a slow week but reflects a broader trend that has been unfolding since earlier this year.”