Canberra’s auction clearance rate last month hit its highest level in more than a year, as optimism among sellers and agents has grown heading into spring.
On the auction circuit, 64 per cent of properties sold under the hammer in August, Domain data shows. This is the highest recorded rate for the capital since May last year.
It comes off the back of a slow year for Canberra’s market. In the first six months of 2019, the monthly clearance rate did not record a performance above 50 per cent. In April, house prices in the capital recorded their steepest annual fall in more than a decade.
The improvement in auction performance indicates the market has rebounded, Domain economist Trent Wiltshire says.
“The Canberra market has strengthened over the past couple of months. Clearance rates are rising and prices look to have bottomed out,” he said.
Recent announcements such as interest rate cuts and a loosening in lending criteria have also contributed to a boost in sentiment, according to Mr Wiltshire.
This comes at the start of what is often dubbed the “spring selling season” – spring is the biggest month for real estate across Australia.
Tom Seselja has a dual-occupancy property on the market in Pearce that is set to go to auction at the end of the month. The property came onto the market this week and he said he was feeling confident at the beginning of the campaign.
“Spring generally brings on a bit of confidence,” he said.
“We’re only just coming on to the market but I believe there will be more confidence than earlier in the year.”
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The three-bedroom, tri-level home was built by Mr Seselja, who is a local developer. He said he normally doesn’t take his properties to auction but decided to this time around.
“We don’t often go to auction but we have seen the trend for more demand for auctions – it’s quite neat and easy, if you build a good product then people will buy it,” he said.
“We could’ve gone either way and there’s a little bit of confidence that steered us to going towards auction.”
Mr Seselja’s listing agent, Jonathan Charles of Independent Woden, predicts Canberra’s market will record a strong performance over spring.
“I definitely think there will be an increase in the median house price over spring, definitely, and clearance rates will be really strong,” he said.
“Coming in at the back of winter, everyone is a bit more chirpy and there’s a bit more activity in the market that’s for sure.”
Mr Charles said the recent stamp duty abolition on all properties for first-home buyers in Canberra was also adding stimulus to the market.
“First-home buyers can actually afford a little bit more, and that’s enabling people to upgrade their home if they live in a suburb with an entry-level median house price,” he said.