Australia's housing market has shown some signs of resilience with improved demand driving a lift in home auction results across Australia.
Activity and confidence has continued to pick up since the May federal election, with lower interest rates, tax cuts and a relaxation of APRA's mortgage serviceability requirements reigniting the housing market.
Following the downturn of the past two years, where Sydney prices fell nearly 15 per cent from the peak of the market in 2017, and Melbourne fell over 10 per cent, there are continuing signs that conditions are easing.
The low number of homes going to auction has caused heightened competition from buyers who have been encouraged by interest rate cuts, a tax-cut package valued at $15 billion and, until recently, falling property prices.
Buyer confidence has returned to the market, with early property auction data from the weekend suggesting higher clearance rates lifting the national preliminary figure to 71.2 per cent.
Weekly clearance rate, combined capital cities
While clearance rates are trending higher, auction volumes remain lower year-on-year. Over the same week one year ago 1,536 were taken to auction.
Corelogic said 1,115 homes taken to auction across the combined capital cities this week, up from the 896 homes auctioned last week. Over the same week one year ago 1,536 were taken to auction.
The two largest auction markets, Melbourne and Sydney, saw their preliminary clearance rates rise this week; both coming in at the mid-high 70 per cent mark, with both cities also seeing an increase in volumes over the week.
Over the past week, clearance rates were strongest in Sydney, recording a 78.5 per cent preliminary clearance rate, up from last week’s 72.8 per cent final clearance rate.
There were 391 Sydney homes taken to auction in the week to Saturday, increasing on the week prior when 303 homes were auctioned.
The number of homes listed was still shy on the 469 auctions in Sydney during the same week last year.
In Victoria – the country's largest auction market – Melbourne returned a 74 per cent preliminary auction clearance rate across 546 auctions, after last week’s 67.5 per cent final clearance.
Across the smaller auction markets, Adelaide was the best performing with a preliminary clearance rate of 56.7 per cent, while only 14.3 per cent of Perth homes sold at auction.
Average values were mixed across the main capital cities during the week, with prices edging up 0.1 per cent in Sydney and Melbourne, adding 0.2 per cent in Brisbane, unchanged in Adelaide and falling 0.2 per cent in Perth.
The uptick comes at a welcome time as the market heads into a testing spring selling season.
Earlier this month the Reserve Bank cut official interest rates to 1 per cent in an effort to kickstart the economy and drive up wages and employment. A third interest rate cut is expected by Christmas.