With a high volume of listings and buyer confidence in an uneasy environment, all signs point to a successful auction weekend in Sydney – good or bad.
This week could be the second biggest auction week in NSW since at least 2019, according to preliminary reports from PropTrack.
While forecasts indicated that 1690 auctions would be held across the country this week, they also suggested that this high volume would be met with a clearance rate of only 50-53 percent.
And, according to PropTrack economist Anne Flaherty, it’s possible that the approval rate could even dip below 50 percent amid a wave of homebuyers.
Ms Flaherty said it had been “a long time” since Sydney recorded a clearance rate of less than half, except in January and December after Christmas.
This week was one of the highest volume weeks on record for March in NSW. Photo: Monique Harmer
For many retailers, the auctions scheduled for this weekend came in an effort to beat the unusual extended market closures that will disrupt the auction market twice in April, with Anzac Day on Saturday and the usual market shutdown that occurs over Easter.
Combined with this holiday lockdown, there could also be a push to get properties up for auction before interest rates rise for buyers, with all four major banks predicting a rate hike at the Reserve Bank in May.
REINSW CEO Tim McKibbin said rising prices were one of the reasons for the shake-up in Sydney consumer confidence.
“We suspect that the increase in interest we had will not be the last we see this year,” he said.
“We always see that international turmoil has some impact on the market.
“When you put all those things together, there was a collapse of confidence in the market.”
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All four major banks have forecast another rate hike in May
According to Mr McKibbin, Sydney has seen low approval rates because of this uncertainty.
This means that a number of sellers – possibly up to half – will be delaying auctions, selling earlier, changing strategies, or being left holding their keys in their hands as the auction goes on.
In this regard, Mr McKibbon said retailers need to “meet the market”.
“There is an old saying that the market never lies,” he said.
“What the market is telling us now is that the price of land is now lower than it was six months ago.”
Mr McKibbin noted that a retailer’s decision will always be driven by personal circumstances.
“I sympathize with people in those positions but the truth is that you have to meet the market if you are going to sell.”
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REINSW CEO Tim McKibbin said there had been a “collapse of confidence” among consumers.
One area where real estate agents are not worried about a lack of buyer demand is in Sydney The Inner West.
At auction this morning, 2 Roberts St, St Peters, sold under the hammer for $2.451m, clearing the reserve and $2m guide.
There were four registered bidders and three working at the three-bedroom home, which has been owned by the sellers for 30 years.
One of the sellers had moved to Western Australia and was selling the home to provide for her five children, according to Ray White Surry Hills chief sales officer Timothy Gorring.
“It was a really good result,” Mr Gorring said.
“The sellers are absolutely delighted.”
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The buyers of this home were local builders, hoping to build two duplex style homes on a 367 sqm block located just 3km from Sydney Airport.
Regardless of market conditions, Mr Gorring said the Inner West was “drought-proof”, due to the price and location of properties.
Mr Gorring said there was still a “level of optimism out there” among buyers, particularly developers, downsizers and first home buyers.
“The only type of withdrawal is really investors, who are waiting for May and seeing what the capital gains tax does to them,” he said.
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The seller’s family celebrate the sale of 2 Roberts St with agent Timothy Gorring (centre). Image: Provided
In the current market, Mr Gorring said there are a few simple keys to success that retailers can use.
“Buildings must be well presented at all times,” he said.
“Also, you need to be flexible about the times you’re showing consumers right now.”
Elsewhere in the Inner West, 55 Buckland St, Alexandria sought $2.9m at auction.
The three-bedroom flat was targeted at $2.5m.
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55 Buckland St, Alexandria
Of Lower North ShoreMcMahon’s Point, two apartments across the street are being sold by the same agent and seller.
Both 11/188 and 9/161 Blues Point Rd sold above reserve under the hammer on Saturday morning, for $930,000 and $1.51m respectively.
Auctioneer Edward Riley said the results “reinforce strong positions in the Sydney housing market”.
“Toughly held, lifestyle-driven villages continue to perform well, mostly immune to broader volatility,” he said.
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188 Blues Point Rd, McMahons Point
Finally affordable for Sydney’s wealthy Eastern cities5/203 Birrell St, Waverley sold for $185,000 over estimate for $1.585m.
Eight tenders were registered for this auction, five of which were still active.
Angus Gorrie of Ray White Eastern Beaches said the market was “really tight” in terms of consumer activity.
“But there are still buyers out there,” he said. “Eight registered buyers today is a really good sign.”
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