Ray White Auction Results Show Signs of Market Moderation
The latest auction results from Ray White indicate a potential slowdown in the Australian housing market, offering a glimmer of hope for homebuyers looking to enter the market amidst years of relentless price growth.
Key Findings:
- Rising Auction Numbers: Ray White conducted 3,534 auctions nationally in August, a 15% increase compared to the previous year.
- Decline in Active Bidders: The number of active bidders has decreased, with an average of 2.7 people actively bidding compared to 2.9 the previous year.
- Slowing Price Growth: Despite an annual acceleration in price growth, there has been a noticeable slowdown on a monthly basis.
- Regional Variations: The slowdown is primarily driven by the Sydney and Melbourne markets, while Brisbane and Perth have seen an increase in active bidders and clearance rates.
Regional Breakdown:
- Brisbane: Average active bidders increased from 3.3 to 3.7.
- Perth: Average active bidders jumped from 3 to 3.6, with clearance rates soaring from 50% to 85.7%.
- Sydney: Active bidders declined from 3 to 2.7, with clearance rates dropping from 70.9% to 65.7%.
- Melbourne: Active bidders fell from 2.8 to 2.3.
KPMG Forecast: Continued Price Growth Expected
Despite the signs of moderation, consulting firm KPMG forecasts ongoing price growth in the housing market for the remainder of 2024 and into 2025.
KPMG Insights:
- Price Forecast: Prices expected to rise by 5.3% nationwide by the end of 2024, followed by a further 5.6% increase in 2025.
- Market Resilience: Despite challenges such as high interest rates and inflation, the housing market has shown resilience due to demand surpassing supply.
- Supply Constraints: Insufficient supply, coupled with rising material and labor costs, continue to pose challenges for developers.
Analysis:
The real estate market is showing signs of moderation, with some regions experiencing a slowdown in price growth. However, persistent demand, supply constraints, and economic factors continue to drive prices upward. Homebuyers should remain vigilant and consider the broader market trends when making purchasing decisions to navigate the evolving landscape of the housing market.