Morning Briefing: Auction volumes skyrocket as clearance rate plummets

Auction volumes skyrocket as clearance rate plummets
Australia’s capital cities are preparing for their busiest week since August, with the total number of auctions to be held this week closing in on 3,000.

Figures from CoreLogic RP Data show there are 2,842 auctions scheduled across the country this week, up from the 2,593 scheduled last week. 

The increased volume could mean another week of low clearance rates however, after last week’s final capital city weighted average came in at 69.9%.

Melbourne has narrowly pipped Sydney as country’s busiest city this week, with the Victorian capital set to hold 1,206 auctions this week, up from the 1,127 last week.

Sydney has also seen a similar rise in its volumes over the week, with the harbour city set to hold 1,198 auctions this week compared to 1,041 last week.

With those numbers it’s no surprise that the busiest suburbs this weekend belong to either Sydney or Melbourne.

Melbourne’s Reservoir will be the busiest suburb with 23 residential auctions scheduled, followed by Mosman (Syd) with 19, Preston (Mel) with 17 and Glen Waverley (Mel) with 16.

Vendors in the Adelaide market will be hoping its momentum carries into this week as volumes in the city of churches increase.

The South Australian capital last week recorded a clearance rate of 71.4%, good for the second highest national result, and will be hoping for a similar result this week as auction numbers rise from 99 to 130.

Brisbane is also set for a busier weekend, with 202 homes in the Queensland capital set to go under the hammer compared to 143 last week.

Canberra (58 this week compared to 118 last week) and Perth (25 this week compared to 31 last week) are the only two cities where the number of auctions is down week on week, however, both cities' current auction activity is higher than it was one year ago.

Originally from Your Investment Property, Phil McCarroll
 
Americans purchased new homes in August at the fastest pace in more than seven years.
WASHINGTON (AP) New-home sales surged 5.7 percent last month to a seasonally adjusted annual rate of 552,000, the Commerce Department said Thursday. That is the strongest pace since February 2008, near the beginning of the Great Recession. Last month's increase followed an even bigger 12 percent jump in July, according to the government's revised figures.

Healthy hiring and smaller price increases for new homes have finally begun pushing up sales, which were hammered during the Great Recession and recovered slowly even after the downturn ended in 2009. New-home sales have soared nearly 22 percent in the past year.

Sales figures for newly-built homes are notoriously volatile and typically revised heavily in subsequent months. But most economists were still encouraged by the gains.

"Housing has been an economic bright spot this year and activity in the new home construction market remains solid," said Michelle Girard, an economist at RBS Securities.

Surveys show that homebuilders' outlook is the most optimistic in a decade, a sign that construction could pick up. The supply of new homes has been scarce, so greater construction could result in more sales.

Strong gains in new-home sales and construction could accelerate the economy by generating construction jobs, demand for more building materials and more spending on landscaping and other services.

Home builders raised new-home prices aggressively last year, likely weighing on sales, which totaled just 414,000 in 2014. That was little changed from sales in 2013. But builders have reined in price increases this year, fueling more buyer traffic and purchases.