There were 770 auctions reported to the REIV over the weekend producing a clearance rate of 70%. Last week the final numbers were 1,164 auctions and a 69% clearance rate and this time last year, 668 auctions with a final clearance rate of 97%. 399 sold at auction, 137 sold before auction, 234 passed in and there were an additional 178 private sales.
Of the auctions we attended on the weekend, most of them passed in but passed in on genuine bids. In most situations this meant that the vendors reserves are still high however some buyers are standing firm on price. One reason for this is that the buyers are factoring in the interest rate rises in their overall budgets. In almost all of these auctions that passed-in, the property sold immediately after.
With cost of living rising and interest rates going up, this has created some uncertainty and resulted in some buyers sitting on their hands. Savvy investors are looking at the winter period as a time to buy with less buyers in the market. That being said, a 70% clearance rate does not necessarily mean we are in a buyer’s market as such, but rather still in a very stable market. Once inflation is under control, and we have seen a few interest rate rises, many buyers will still see that money is still cheap and decide to buy. We are predicting Spring to be a very active market.
There are still auctions though that are attracting strong competition. 75 Little Oxford Street, Collingwood is a very unique property and zoned both commercial and residential. The property was quoted at $1,375,000 to $1,450,000 prior to auction. It has three bedrooms, two bathrooms, no carparking and requires a lot of work. 6 bidders bid strongly to secure the rare piece of real estate which sold under the hammer for an undisclosed price.