Relative Use of Auctions around Australia
For quite a long time auctions have been a Melbourne thing. At one stage they were mainly an inner Melbourne thing, but now they can be found throughout Melbourne.
A while ago Sydney also started really getting into auctions. Now they are a pretty big thing there, although they have yet to approach Melbourne-type numbers. Brisbane, Adelaide and Canberra also have a fairly healthy number of auctions. Perth and Hobart have relatively few auctions.
To put this into numbers, the following figures are quoted in an article that appeared in The Age on 16 July 2019. The article states that the figures were sourced from Corelogic. In fact these figures were not the point of the article – the article was actually about changes in auction clearance rates, but the following were given as background figures.
For the June 2019 quarter:
Melbourne had 7,838 auctions
Sydney had 6,776 auctions
Brisbane had 1,380 auctions
Adelaide had 1,082 auctions
Canberra had 578 auctions
Tasmania had 41 auctions.
(In the context in which the figures are given, it is likely that the amounts shown are for auctions where the results were reported. I note that no figures were given for the Northern Territory.)
Thus in that period Melbourne hosted 43% of the auctions held, and Sydney hosted 37% of the auctions held. Combined, the 2 cities hosted 81% of the auctions held. If you are wondering why I have only written books about how to buy at a house at auction for Victoria and New South Wales, there’s the answer.
Other differences between Melbourne and Sydney concerning auctions
I mention in my book that there are 2 significant differences between Melbourne and Sydney with respect to house auctions:
a lot more houses are withdrawn from auction in Sydney than they are in Melbourne
a lot more house owners accept pre-auction offers in Sydney than they do in Melbourne.
My book provides more precise figures on these differences based on auctions conducted in early 2019.
As the rate of withdrawal is a fairly easy figure to get hold of, I can provide an update on the rate of withdrawals.
On page 96 of my N.S.W. book I mentioned that the long-term pre-auction withdrawal rate in Sydney is about 10%, but that in early 2019 it increased to about 20%. These figures were derived from reports by domain.com.
Based on the raw figures from the weekly auction reports of domain.com for Sydney, I have calculated that for the 4 Saturdays of auctions held in July 2019 combined, the withdrawal rate in Sydney was 8.21%.
In my Victorian book I did not mention the withdrawal rate in Melbourne, because it was low enough to be relatively insignificant. Based on the raw figures from the weekly auction reports of domain.com for Melbourne, I have calculated that for the 4 Saturdays of auctions held in July 2019 combined, the withdrawal rate in Melbourne was 4.23%, so it is still quite low.
Pre-auction acceptance rate
With respect to the acceptance of pre-auction offers, when I collect more recent figures in relation to them (it involves a fair bit of work), I will publish them here.