Auctions clearance rates last week remained near their lowest levels since early this year, but housing prices in Australia’s mainland state capitals continued to creep higher.
In the week ending Sunday, 69.6 per cent of homes taken to auction were sold, the lowest clearance rate since early February, according to preliminary data from CoreLogic RP Data.
At the same time, prices rose in four of the five capitals covered by the weekly figures.
Rises averaged 0.4 per cent in Melbourne and Adelaide, 0.3 per cent in Sydney and 0.2 per cent in Brisbane.
The exception was Perth, where prices were unchanged after an unusually strong 1.2 per cent rise the week before.
Annual changes were more widely dispersed. Prices were up by 16.6 per cent from a year earlier in Sydney and by 13.7 per cent in Melbourne.
These two centres were mentioned in the monthly interest rate announcement from the Reserve Bank of Australia on Tuesday, as it kept the cash rate at 2.0 per cent.
But the central bank seemed to be more confident that efforts by the Australian Prudential Regulation Authority, the Foreign Investment Review Board and the Australian Tax Office to keep the boom in housing credit under control were having an effect.
“Regulatory measures are helping to contain risks that may arise from the housing market,” the RBA said.
Prices were more subdued over the past year in the other three capitals covered by CoreLogic RP Data’s, up by 5.1 per cent in Brisbane and 0.5 per cent in Adelaide, but down by 1.8 per cent in Perth.
Not too much should be made of the week-to-week movements in auction clearance rates at this time of year, with football grand finals dramatically affecting the volume of properties going under the auctioneer’s hammer.
The number of sales recorded by CoreLogic RP Data last week was only 841, down from the six-month high of 2,835 the previous week.
Even so, a downward trend in clearance rates is typical of this time of year, a pattern driven by pronounced seasonal cycles in Melbourne and Sydney.
If the usual pattern is followed the downward trend in clearances will most likely continue into the Christmas/New Year break with the national average approaching 60 per cent.