Auction season off to a strong start

Increases to the Government’s first-home owner’s grant has given the property market a boost, with auction clearance rates in capital cities starting the 2009 auction season strongly.

The Sydney clearance rate reached 72%, with 139 properties sold and total sales reaching $49.8 million.

Real Estate Institute of Victoria chief executive Enzo Raimondo described Melbourne’s results as “very pleasing”, with the city recording a clearance rate of 70% across 246 auctions. Total sales were $86.6 million.

Brisbane achieved a 35% clearance rate with seven properties sold, while Adelaide saw a 33% clearance rate with just four properties going under the hammer.

The results come after Bureau of Statistics data revealed last week shows that loans to first-home buyers made up 40% of all loans in total.

Noel Dyatt, president of the Real Estate Institute of Australia, says the market is beginning to rebound.

“Those results are starting to reflect the confidence that’s come back into the market, which is generated from a base of the first-home owner’s market. We’ve seen more first-home owners come back because of the lowering of interest rates, the increase in Government incentives and the fact that prices have started to come off a bit in some markets.

“It’s certainly good to see that this interest has come back into the market. We’re out of the holiday season now, and people are now in the business of buying homes.”

Raimondo says lower interest rates are also helping.

“Buyers have been encouraged by the significant interest rate cuts over the last few months. It is clear that the lower cost of funds has helped to boost demand when compared to last year”.

 <

Related story:

• Why residential property will pick up in six months