I was having a chat with a homeowner this afternoon, and he was talking about the low clearance rates at auctions at present. His real estate agent was trying to convince him to go to auction, but he didn’t think it was the best course of action at present. According to the owner, properties like his, where the decision to sell is optional, are losing out to cheaper properties that are selling as a result of a financial need, such as a foreclosure.
Perhaps this is what we’re seeing happen Australia-wide, as successful auctions are less common than they used to be. In Sydney, only $88 million worth of property changed hands last weekend, in contrast to $173 million for the same weekend last year. Here in Brisbane only 13 properties were sold at auction, for a clearance rate of just 31.7 per cent. You’ll find out more in The Australian (“Home buyers unmoved by budget”).
So should you be selling your home via auction at the moment? Well, that’s up to you. Some homes are going well, and some aren’t. The good thing about an auction is that at least it creates a day of action where something has to happen, whilst other homes are sitting around doing nothing for weeks on end. The negative is that you can pay a few thousand dollars and not get a result (although at least your marketing campaign is drawing attention to your property).