Sydney 81.4% auction clearance rate

Solid enough result for Melbourne today, recording a 69% auction clearance rate according to APM (REIV recorded 70% from their sample).

That's just about par for the course for the softer winter months.

On the other hand, the Sydney market is absolutely flying recording another very high clearance rate of 81.4% per APM.

The median sale price on the day was more than $800,000. 

With properties selling so quickly in Sydney, prices will very likely continue to rise to new heights in the coming months.

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Sydney auction clearance rate ~70%...ish

Fewer auctions this weekend as it is the Queen's Birthday long weekend.

APM reported here that there were 253 auctions to be held this weekend with the highest listings on the north shore and in the inner west.

And APM later reported here that the clearance rate was 70%.

However, the reported results only covered 171 properties. These inconsistencies cause scepticism around the robust nature of results.

I noticed in passing that one of the reported results wasn't a scheduled auction for this weekend - it was a property scheduled for auction next weekend which sold prior to auction.

Overall, the results looked a little patchy - solid but not spectacular, with perhaps only a moderate lift in prices on a year ago.

Maybe Sydney is in for a quieter winter selling season, although in truth this wasn't the best weekend from which to judge with far fewer properties scheduled for auction.

Similar story in Melbourne where the reported clearance rate from APM was weaker than the trend at 60%.

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APM: House prices rise by 5.4%

APM reports that house prices have increased...well, everywhere, over the 12 months to June.

While gains have been predictably weak in Adelaide and Hobart, house prices have increased very strongly in Perth (+7.5%), Sydney (+6.7%), Darwin (+5.7%) and Melbourne (+6.1%).

Median house prices are now at record highs in Sydney, Perth and Canberra, and even Melbourne is now only a fraction (-1.4%) below its previous peak. 

Therefore, the 'bull trap' theory - that prices would fade before returning to previous heights, thereby suckering new buyers - has failed to materialise in these cities.

Prices in Sydney look likely to continue growing with properties selling very quickly on average and the city recording scorching auction clearance rates in July.

Source: APM

APM also shows unit prices up strongly in Sydney (+4.9%), Perth (+9.3%), Melbourne (+4.2%) and Darwin (+10.3%) over the 12 months - but down in Adelaide and Hobart.

Sydney unit prices are also at new record highs this quarter.

This leaves the "Don't Buy Now" campaign which has been ongoing over the past few years in something of a sticky spot - how long are prospective buyers to be instructed to boycott buying a home while waiting for the promised major house price correction? 

Of course, prices can always fall, but second-guessing markets in this manner can be a dangerous game to play.

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APM: Sydney property firing

Prices on to all-time highs for both houses and units in Sydney with auction clearance rates moving back into 'very strong' territory.

Meanwhile, RP Data looks set to report an astonishing 2.7% price growth in Sydney for just the past month. Not sure what's going on there.

The contrast with the plummeting gold price chart (which has collapsed from US$1,900/oz to below US$1,200/oz this week in spite of its supposedly 'strong fundamentals) is now very stark.

Interesting that an asset class which was apparently 'not in a bubble' according to some commentators in 2012 can lose 40% of its value, while Australian property, has continued to rise broadly in line with household incomes for the past decade.

This is precisely the problem with gold for me - it pays no yield, so what, really, is its fair value? 

Source: APM

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Property Update: articles of the week

Summarised by Michael Yardney at Property Update here.

A very strong 75% of properties sold at auction on Saturday in Sydney, with buyer activity some 20% higher than a year ago according to APM.

Meanwhile RP Data shows that prices have increased across all capital cities in the past 12 months.

Source: RP Data

In particular, Perth (+7.78%) and Sydney prices are strong, with Sydney dwelling prices breaking up to new all-time highs (+4.73%).

Source: RP Data

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APM: Sydney property market "hot"

From Australian Property Monitors:

"Another set of extraordinary results for Sydney’s hotter than hot home auction market was recorded at the weekend. The auction clearance rate of 80.8 percent was the third consecutive weekend of clearance rates above 80 percent. Auction clearance rates continue to track at levels not recorded for over ten years at this time of the year.

With auction clearance rates at their highest levels for years it’s no surprise that Sydney house prices are also growing at their fastest rates for years. The Sydney median house price increased by 2.7 percent over the June quarter which was the fastest rate of quarterly growth recorded since March 2010 during the previous house price boom.

With Sydney houses prices having increased by 6.7 percent over the 2013 financial year it’s also no surprise given almost historically low interest rates for both borrowers and depositors that investors are flooding into the Sydney housing market at record levels.

The best regional result in Sydney this weekend was recorded in the north west with an outstanding auction clearance rate of 93 percent. Another strong result was recorded by the consistently popular inner west region which despite providing clearly the highest number of auction listings at the weekend recorded an auction clearance rate of 90 percent.

With weekend auction clearance rates showing no signs of slowing down expect house prices to continue to surge with real the prospect that before years end, the median prices for Sydney houses to exceed $700,000 and the median price for Sydney units to exceed $500,000."

Most economists, 22 of 28 surveyed by Bloomberg, expect interest rates to be dropped again in August.

With auction clearance rates already at sky high levels in Sydney, the predictions of a slow decline in Sydney's housing market look to have been very wrong. 

While some new supply has hit the market in recent years, the population is growing at such a rate that the desirable stock is quickly absorbed, and Sydney properties have become among the fastest-selling in Australia.

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Sydney auctions point to further price gains

The REIV reported a solid enough 72% auction clearance rate for Melbourne on Saturday.

In Sydney, APM reported an "extraordinary" 81% clearance rate, the third consecutive week in which the 80% barrier has been exceeded.

The activity levels continue to point to an ongoing price boom in the hot sectors of the market in Sydney.

Earlier in the week, APM reported that house prices in Sydney, Perth and Canberra are now at record highs with Melbourne only a shade below its all-time highs, although Brisbane and Adelaide still have a way to go if they are to follow suit.

Perth and Sydney have recorded gains of around 10% since their respective troughs of a little over a year ago and prices have increased reasonably well everywhere except for Adelaide.

But it's Sydney that is the real embarrassment for the chorus of voices predicting a "40% crash" half a decade ago, with prices well above all previous peaks.

Not only did dwelling prices increase by more than 20% as household incomes grew, the price gains actually now appear to be accelerating with properties selling remarkably quickly and a swathe of speculative investment capital flowing into the city.

If you're a follower of the weird obsession with daily house prices, RP Data has Sydney prices up around 5% in less than 50 days, and looks set to report increases of around 2% in July alone at the end of this month.

I'm not sure how those who called a crash so hopelessly wrong will explain that one away.

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