Property is always the talk around the table and auction clearance rates are on the tip of everybody’s tongue. But what are auction clearance rates used for? Typically, these numbers are indicators of how buyers perceive the market. When auction clearance rates are tracking above 70% this number is a key sign that the market is hot and is typically a seller’s market. Above 60% shows there is a steady demand of buyers to sellers and lower than this number increasingly suggests that the market is swinging in favour of the buyer.
Although auction clearance rates are a useful tool as a guide to how the market is performing, the data is not comprehensive enough to indicate exactly how property sales are tracking. Why, because no one monitors how the properties fair after the auction. Did they sell? Were they withdrawn from market? Who knows, as there is no data for this information. For example, recent auction clearance rates released advise that the percentage of properties either sold prior or at auction is sitting around 61% in the Inner West or 57% in Sydney overall. However, there are no statistics available to show what the actual clearance of properties are after auction. According to a report in the Financial Review at the end of May 2018, the average days on market in Sydney for houses had risen to 63 days representing an increase which had been sitting around 45 days at the peak of the market in 2017. Days on market have been hovering around the 60s since March.
Discussing this topic with other agents and auctioneers, it seems that the majority agree that most properties are selling 7 to 14 days post auction day if unsuccessful under the hammer, evidenced by average current days on market. Monitoring properties listed, auction results and sales results post auction, it would be fair to say the Inner West has a 95% clearance of properties put to market. That figure is quite different to the auction clearance rate and I’m sure the general public can see how this information skew whiff’s the perception of the property market. It’s not all doom and gloom!
Here at The Property Sellers’s we are proud of our continued 100% clearance of all properties put to the market – testament to our extensive real estate experience. If you are thinking of selling or would like to know what your property is worth in the current market, give us a call on 9560 0088.