- Clearance rate falls to 58.4% for week ending Nov. 8
- Data adds to signs of home market pullback in biggest cities
Auction clearance rates of Sydney homes dropped to the lowest since March 2013 as a regulatory crackdown on mortgages and interest rate increases by banks put off buyers amid record prices.
The rate, an indicator of buyer demand, fell to 58.4 percent for the week ending Nov. 8, according to data from property researcher CoreLogic Inc. That compares with a peak of just over 90 percent in April in Sydney, where a third of all homes are sold through auctions.
Buyers are hesitating after home values soared 47 percent in the three years to Oct. 31, denting affordability, and a regulatory clampdown prompted banks to raise interest rates for the first time in five years for owner occupiers. That has seen economists from Macquarie Group Ltd. to Bank of America Merrill Lynch forecast a decline in prices over the next two years.
About 3,300 homes will go under the hammer across the country in the week ending Nov. 15, compared with 2,947 a week earlier, according to CoreLogic. About 1,270 homes will go to auction in Sydney, while Melbourne is expected to have 1,504 auctions, the data show.
Across the country, the clearance rate held steady at 61.4 percent, with Melbourne leading at 69 percent, the figures show.