IF you’re driving around the suburbs of Sydney or Melbourne tomorrow, it might pay to watch out for flying hammers.
That’s because tomorrow is the busiest auction day of the season around Australia — especially in our two biggest cities Sydney and Melbourne.
A mammoth auction day occurs each September because sellers historically don’t want to list their homes in winter. But they do want to offload their properties before December.
Most residential settlements take three months. That means if you want to be snug and cosy in your new digs by Christmas, this weekend is pretty much your last chance. Sellers know it, buyers know it and real estate agents know it too.
Sydney and Melbourne have more than 1000 scheduled auctions each this Saturday, a day coined “Super Saturday” by an industry that has traditionally done big business in spring.
In Sydney 1198 are properties set to go under the hammer according to Core Logic RP Data figures and in Melbourne 1206 auctions are planned.
With a median dwelling sale price in the harbour city sitting at $773,000 and $679,000 in the Victorian capital, that could add up to a whopping $1.605 billion worth of property changing hands in just one day.
But might there be a bargain in it for you?
The auction frenzy comes in the same week new analysis from Morgan Stanley showed the Australian property market might have hit its peak.
New rules have come into place which make it more expensive for investors to borrow money for their property portfolios. People who actually want to live in homes now get a better deal from lenders than investors. So maybe, just maybe, prices have plateaued for now.
“We are now calling the peak in the housing cycle, and expect further falls in auction clearance rates and house-price momentum, with a negative impact on construction occurring over 2016,” Morgan Stanley’s report said.
Meanwhile Damien Cooley of Sydney-based Cooley Auctions has 113 auctions scheduled for Super Saturday tomorrow. “There is just more choice than there was a few months ago. It’s giving purchasers better buying opportunities now,” he said.
Nicole Jacobs of Jacobs Buyer Advocates said househunters also have more choice in Melbourne compared with recent months.
“There’s definitely more stock on the market and we’re starting to see more of a buyer’s market,” she said. “And as a result buyers are just saying ‘No, I’m not going to pay that’.”
In both state capitals, average auction clearance rates have dropped from above 80 per cent throughout winter to around 75 per cent or lower in recent weeks.
As for you lucky homeowners out there, if you’re still considering selling before Christmas, it might pay to think twice.
“People have always thought spring is the time to sell property, but personally I wouldn’t sell then. Why sell when everyone else is?” said Simon Cohen of Cohen Handler buyer’s agency.
Mr Cohen said the listings spike across Sydney and Melbourne means buyers can be strategic.
“Don’t fall for the hype. Make sure you buy the right property for the right price and don’t get emotional. There will always be another.”