The transparency of the auction process in itself is an excellent tool to gauge market conditions at any given time.
Various property bodies or service providers calculate auction clearance rates on a weekly basis.
Generally speaking, clearance rates below 50% would suggest a weak market. Despite concerns of the changing market in the last year or so, 67% to 75% clearance rates have been seen in the 2023 calendar year to date, which are not dramatically less than the clearance rates seen a year prior.
Clearly, such figures suggest there is a fairly healthy balance of market supply and demand. We have certainly seen a lessening of buyer demand since interest rates began to rise in May 2022, but this has been balanced by the reduced number of properties being listed for sale.
Overall Sale Numbers
While NSW has seen minimal drops in auction clearance rates, there has certainly been a notable reduction in sales transactions in the last 12 months.
The suburb of Wollongong is a very good example when assessing the 12 months ending Feb 2022 (1,115 properties transacted), versus the 12 months ending Feb 2023 (758 properties transacted).
This represents a 32% drop in the quantity of sales in Wollongong.
