Australia has recorded the second biggest start to auction season on record, with 1671 properties going under the hammer last week across the capital cities.
According to CoreLogic, only the first week in February 2022 had more auctions, with 1779 auctions, since it started keeping records in 2008.
Compared to the same time last year, auction activity was up 26.4 per cent and was more than double the number of capital city auctions held over the year so far, at 803.
Buyers were also out in force, with Ray White reporting a 24 per cent increase in buyers attending open homes since January 1, compared to the prior year.
On average, auction crowds reached 60 people nationally on Saturday, with some 10 per cent higher than last January.
CoreLogic recorded a preliminary clearance rate of 73.9 per cent, from 1268 collected results.
It was the highest since the week ending August 20 in 2023.
CoreLogic Economist Kaytlin Ezzy said across the capital cities, Melbourne hosted 603 auctions, while Sydney saw 562 homes go under the hammer.
“Compared to this time last year, both markets saw a sizable lift in auction activity, up 46 per cent and 32.5 per cent respectively,” she said.
“Sydney and Melbourne also saw a sizable step change in early success rates compared to the end of last year, with both markets recording a preliminary clearance rate above the 70 per cent mark.
“Melbourne recorded its highest preliminary clearance rate since early October last year, with 71.9 per cent of the 488 results collected so far returning a successful result.
“Sydney’s early clearance rate came in at 76.3 per cent with 434 results collected – the city’s highest preliminary result since the week ending July 20, 2023 (77.5 per cent).”
Across the smaller capitals, Brisbane hosted the busiest auction week, with 203 homes auctioned, followed by Adelaide (159), Canberra (132) and Perth (9).
Canberra recorded the highest preliminary clearance rate at 80 per cent, followed by Adelaide and Brisbane, with early success rates of 77.6 per cent and 68.5 per cent.
“Potentially, the news of low inflation and the possibility of early rate cuts is already boosting sentiment, Ms Ezzy said.
“The next few weeks should provide further guidance on whether this strong result is simply some early-year exuberance or a trend that can persist.”
Ray White reported its standout weekend auction was 35 Chisholm St, Turramurra, which sold for $2.88 million for agent Liana Power.
Meanwhile on Brisbane’s southside, 28 registered bidders vied for the federation home at 7 Cotswold Place, Wishart, which Ray White Mt Gravatt sales agent James Austin sold for $1.602 million.
Market watchers are keenly awaiting the outcome of the Reserve Bank of Australia’s first board meeting for 2024 this Tuesday.
Ray White Group Chief Economist, Nerida Conisbee, said there was a distinct change to the interest rate outlook at the end of last year.
“In early December there was a view that we were in for at least one more rate rise,” she said.
“In mid-December however, a sharp drop in US inflation, followed by the suggestion by the US Federal Reserve that rates could be cut three times in 2024 led to a change in sentiment in Australia.
“By the end of December, markets were pricing in two rate cuts for Australia in 2024.”
A further driver of downward pressure on rates is December inflation, which came in at 4.1 per cent for the year, a significant decline from the September quarter result of 5.4 per cent.
The quarterly decline was the lowest it has been since March 2021.