The RBA’s interest rate cut this month looks to have had immediate effect with the strongest auction result in a year being recorded on the weekend.
Across the country the auction clearance rate was around 66 per cent from around 1500 auctions and it’s the first time the final figure should end up above 60 per cent in over a year.
It continues a bounce in the property market that has been going since the Liberal Party’s shock election win.
CoreLogic analyst Kevin Brogan told Australian Financial Review that auction clearance rates returning to that high 60 per cent mark indicated the market was returning to equilibrium.
Mr Brogan said vendors were now coming out of the woodwork now the election is over.
“We’re also aware of a number of properties selling in Sydney just after being passed in, which was not happening before,” he said.
AMP Capital chief economist Shane Oliver told AFR the market recovery was continuing.
“The post-election and rate-cut bounce is continuing,” he said.
Meanwhile SQM market analyst Louis Christopher says that a clearance rate in the 60s indicates price rises will be on the way.
Here in Melbourne we recorded an auction clearance rate of 67.9 per cent on the weekend from 725 auctions.
CoreLogic in its commentary said that Melbourne’s final clearance rate has held above 60 per cent for three of the last four weeks and this week will be no different.