Auction market steady as sector gears up for “Super Saturday”

Auction markets produced another set of solid but not spectacular results over the weekend, as agents and commentators gear up for the biggest selling day of the month on Saturday, 25 October.

In Melbourne, next weekend has been dubbed “Super Saturday” by the industry. A total of 1,170 properties will go on the market next Saturday, not too far off the peak of 1,350 properties set in March 2008.

While the second-last Saturday in October is traditionally a big day for auctions in Melbourne, falling as it does a week before the Melbourne Cup weekend, results will be keenly watched by buyers keen to get a gauge on the state of the market.

Louis Christopher of SQM Research says the big numbers are seasonal, and should not be taken as a sign that property owners are suddenly heading for the exits.

He says that while property markets have clearly cooled in the first nine months of the year, there are signs that the market is starting to stabilise.

Christopher says trends in housing finance data suggests borrowers are gaining confidence, and he argues that there is a reasonable balance between buyers and sellers – even if some sellers haven’t adjusted their expectations to the new market conditions, as shown by an increase in the length of time properties are staying on the market.

“It’s a sign that sellers have not woken up to the slowdown completely. This is the type of market that is going to churn out capital growth in Melbourne of about 5%. No more, no more less.”

Christopher says the main thing to watch now is interest rates, and argues another hike could shake confidence.

Auctions results around the country were solid but hardly spectacular. In Melbourne, there were a total of 637 auctions and a clearance rate of 67%, up on last week but well down on the 80% clearance rate seen on the same weekend last year.

In Sydney, 292 properties went under the hammer, with a clearance rate of 61%, and a median price of $747,500.

In Adelaide, 42 properties went under the hammer with a clearance rate of 61%, while Brisbane had just 21 properties and a clearance rate of 27%.