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Sydney's Auction Clearance Rate Improves, Overtakes Melbourne

Posted by Jereco O. Paloma on Feb 15, 2016 09:24 AM EST
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SYDNEY, AUSTRALIA - DECEMBER 16: In this handout image provided by Sydney Tower Eye, the skyline and harbour of Sydney is seen from a viewing platform at the Sydney Tower Eye, on December 16, 2011 in Sydney, Australia. Sydney is suffering from its coldest start to summer since 1960. (Photo : Eugene Tan/Hausmann Communications via Getty Images)

Auction clearance rates in Sydney put up an impressive performance at 78.6 percent, outperforming Melbourne's 75 percent.

The marginal difference between the two real estate markets' clearance rate was significant because it was the first time that Sydney overtook Melbourne's digits since last spring, a report from the Australian Financial Review showed. 

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According to the report, the impressive clearance rate figures that Sydney exhibited can be largely attributed to regained buyers' confidence, which had waned last year. Many industry observers were shocked by Sydney's exponential improvement, which started to lag last year.

Apart from improved clearance rate figures, the number of real estate auctions in one of Australia's largest real estate markets has also increased from 276 in the previous week to 370 auctions. Also, buyers in Sydney are becoming more generous in buying properties as evidenced by the amount paid versus the actual selling price of a certain property.

Kevin Brogan, CoreLogic's spokesperson, told the Australia Financial Review that it's too early to say whether the picking up of clearance rates will be sustained, as it might just be an example of an isolated case. However, he said the fact that Sydney overtaking Melbourne in terms of clearance rate since September last year is a game changer and means a lot.

"This is a marked change. It is significant, but we aren't yet at a point where we can say this is indicative of a significant shift. We need to keep an eye on what happens when we get back to the higher volumes," Brogan was quoted as saying by the Australia Financial Review.

According to a separate report published by Domain.com.au, the median auction price in Sydney was pegged at $1,041,500, as of Saturday, February 13. That's relatively higher than the $991,000 median auction priced recorded in the previous week. Compared to a year ago, last Saturday's median auction price was 13.3 percent higher than the same period in the previous year.

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