Melbourne properties sold 12.3% above their highest pre-auction bid, just above the 12.2% average, while Sydney homes sold at a 10.9% premium , below the average of 11.4%.
“Sydney seems to be slowing down a bit faster, which is not surprising as the market has [higher] debt levels, so an increase in the interest rate is much more of a concern,” Conisbee said.
“Also, Melbourne didn’t have the same price run as Sydney… [it’s still comparatively] well priced, whereas Sydney is largely considered to be at the top of the market.”
How bidders and auctions fare in the coming months will depend on how much interest rates rise, he added, but noted that a market slowdown over the winter would also need consideration.
Sydney’s preliminary auction settlement rate fell to 58.5 per cent on Saturday, Domain Group data shows, while Melbourne’s fell to 60.1 per cent. A 60 percent settlement rate roughly correlates with a balanced market.
Charging
Sydney auctioneer Michael Garofolo of Cooley Auctions said buyer participation had dwindled as increased supply gave house hunters more choice in recent months, with record volumes of homes scheduled for sale. auction.
“Good properties, their high-end premium homes, they’re still selling at great prices, they’re still getting a good share, but for your run-of-the-mill or average house in the suburbs…there’s a lot of options, so they’re not selling for a cousin.
Of more than 360 properties scheduled with Cooley Auctions last month, around a quarter were sold early. Those that went to auction attracted an average of 4.4 bidders, and two-thirds sold above seller expectations, quoting an average of $1,148 above the reserve. That compares with an average of about $129,000 above the reserve in the same period last year.
“Suppliers have realized that if we want to sell we have to meet the market,” Garofolo said, adding that those who set unrealistic reserve prices had to adjust them mid-auction to sell.
Although some sellers preferred the certainty of accepting a bid before the auction, Garofolo felt that auctions generally achieved the best possible price in the shortest amount of time, and encouraged those with multiple buyers at a similar level to move on to bid day. auction.
Melbourne auctions attracted an average of three registered bidders last month.Credit:Penny Esteban
He expected the auction market to cool further in the coming months, with an earlier-than-expected rise in the cash rate to put downward pressure on property prices as the market headed into the sales season. winter traditionally slower.
Melbourne auctioneer Arch Staver, director of sales for Nelson Alexander, said the number of bidders had dwindled but properties that were well priced continued to attract interest from a number of bidders.
“A few months ago [you would expect] no less than three participants in any auction, it is not uncommon now that it is reduced to two, or sometimes to one bidder”, he said.
Staver said the rate increase had created a bit of urgency for some buyers interested in buying before their larger pre-approved loan power expired, but noted buyers wanted value for money.
Rising rates and cooling prices would prompt some homeowners to delay or cancel their plans to sell, Staver said, noting that in his experience, vendors in the downtown market chose to sit tight when there was a bit of uncertainty. That could reduce the supply of homes for sale, reducing buyers’ options.
