Sydney Today News from March 3, Australia Eastern Time. Since the auction season lasted for more than a month, we can understand the real estate market by observing how the auction clearance rate is formed and the supply of real estate. Although the auction market is only a small part of the entire real estate market, historical experience has shown that the auction clearance rate can accurately reflect the health of the real estate market on a regular basis. The auction clearance rate can see the key turning point of the market before any other indicators. Therefore, I will pay close attention to the auction clearance rate of Australian Property Monitors.

On the first weekend of this auction season, on February 2th, there were a number of good houses on the auction market. According to reports, the auction clearance rate at that time stabilized at 4% after deducting some incalculable factors. Considering that the clearance rate in the same period last year was higher than the current level, our experts at SQM Research expect that the clearance rate will increase as a result of the interest rate cut at the end of last year. However, in the following weekend, the weekend after the major banks raised interest rates, the auction clearance rate dropped to around 67%. This result caused by the bank's interest rate hike made me pessimistic about the housing market at that time. Since February 50, the auction clearance rate in Sydney has been fluctuating around 2% after taking into account some unpredictable factors, which shows that the news of the bank's interest rate hike has made these real estate agents even more frustrated.

From historical experience, in the fall, there are generally more buyers than sellers in the real estate market, although we cannot clearly explain this phenomenon in the fall. During the period from 1988 to the present, the average auction clearance rate in the autumn reached 61%. So we can see that the current level is lower than this level. Therefore, the media believes that the current real estate clearance rate is higher than the previous level, so the real estate market is now recovering. In this regard, if we have to consider it carefully.

In fact, although the current clearance rate is higher than that in December, it is lower than the same period last year, and the housing market was relatively sluggish during this period last year. We noticed that SQM Research calculated that the stock market trading volume in Sydney last month was 12 percentage points higher than in February, and it was also 2 percentage points higher than the same period last year. Therefore, compared with the same period last year, there is more ample supply in the real estate market (including the private buying and selling market and the auction market), resulting in the current clearance rate being the same as last year's level, or even lower. This means that the sale of land in the market is not tight, and the competition among sellers is more intense.

If the auction clearance rate returns to above 60% before the winter, then we have reason to believe that the housing market is in a recovery period, and we can be more optimistic about the housing market. Of course, it is very likely to happen, if concerns about European debt problems can be eliminated. However, the real estate market is still in a weak state. (Ivy)
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