Forward indicators point to property recovery

The property group also revealed a preliminary auction clearance rate of 70.9 per cent in the week ending 24 May.

REINSW president Leanne Pilkington points to the positive clearance rates as a sign the property market has not fallen as far as predicted.

“It is interesting that the analysts who are now saying the market needs a ventilator are the same ones that were previously saying we were in a boom when the market had 80 per cent clearance rates. So, the way I do the maths, the distance between apparent boom and bust is 2.1 per cent,” Ms Pilkington said.

Clearance rates were highest in Sydney (77.9 per cent), followed by Canberra (73.3 per cent), Melbourne (72 per cent), Brisbane (45.9 per cent) and Adelaide (38.5 per cent).

In volume terms, 613 homes were taken to auction, up week-on-week from 400.

However, volumes were down significantly when compared with the same week in 2019, in which 2,055 homes were taken to auction.

CoreLogic noted that it expects volumes to pick up over the coming weeks in response to the lifting of the on-site auction bans. 

“Given it’s been a few weeks since the ban for on-site auctions and inspections were lifted, agents and vendors have had the chance to start implementing marketing campaigns, and we are likely to see volumes gradually increase each week,” CoreLogic stated.

However, while volumes are expected to rise, analysts are projecting a prolonged decline in dwelling values, which, according to CoreLogic, fell 0.4 per cent in the week ending 24 May.

Despite showing positive signs, SQM’s research shows the market is still recovering.

ANZ Research is forecasting a peak-to-trough decline in property prices of 10 per cent, led by sharp declines in Hobart (11.2 per cent), Melbourne (8.5 per cent) and Sydney (8.1 per cent) over the course of 2020 and 2021.   

The research group said it expects growth trends to begin turning positive in the back end of 2021.