Buyers’ market continues to strengthen

MORE homes are coming under the hammer as the Spring selling season heads towards Grand Final weekend.

But the extra stock in the market combined with fewer bidders is leading to lower clearance rates and clear signs the country is heading for a buyers’ market, according to analysts.

Weekend capital city listings rose to more than 2,400, with clearance rates standing at just over 60 per cent.

My Housing Market chief economist Andrew Wilson said the surge in listings would test buyer sentiment.

“The national weekend auction market reported a clearance rate of 60.6 per cent which was just above the 58.8 per cent reported over the previous weekend – but well below the 70.5 per cent recorded over the same weekend last year,” he said.

“Auction numbers can be expected to rise sharply again next weekend over the pre-Grand Finals Auction Super Saturday and provide another stern test of early spring market buyer depth.

Sydney’s 69.2 perf cent clearance at the weekend was lower than the 71.9% recorded over the previous weekend and also lower than the 72.0 per cent rate recorded over the same weekend last year.

The cooling-off over August was noted in a Ray White Group update.

Chief economist Nerida Conisbee said that while auction numbers were up, the number of active bidders was falling, causing a fall in clearance rates.

“All of this adds up to a slowing market, and price moderation or even falls,” she said.

But there are wide differences across the capital cities, according to the agency that held 3,534 auctions nationally.

That’s an increase of 15 per cent compared to the number of auctions held at the same time last year.

“With auction numbers increasing, we have also seen a fall in the number of active bidders,” she added.

In August, there were 2.7 people on average actively bidding – a decline from 2.9 people from the same time last year. 

While nationally, there has been a reduction in active bidders and a drop in the clearance rate, it has been disproportionately impacted by slower conditions in Sydney and Melbourne, and to a lesser extent by Adelaide and Canberra, according to Ms Consibee.

Perth and Brisbane have seen an increase in the number of people actively bidding and an increase in clearance rates. 

The number of properties coming to market also backs why  it is becoming a buyers market.

Alongside a dip in the auction clearance rate, there were 41,000 new properties on  market over the month.

That’s up 5 per cent on the same time last year and 17 per cent higher than the average over the last five years.