Auctions rock but clearance rates shouldn’t rule
According to Barry Plant Group CEO, Mike McCarthy, an auction clearance rate is a very handy statistic for the media to hang the health of the property market on. However, he believes it’s a very flimsy measuring stick. “It does have some value in that if buyers are cashed up and competitive the clearance rate will be high but if they are cashed up but more cautious the clearance rate, as measured by sales achieved under the hammer, will be lower.”
“What isn’t taken into account, and what isn’t acknowledged in the bandying of the statistic, is that the auction, where people gather to bid, is just part of a very successful method of selling a property.”
Mr McCarthy has the statistics to back his position. “Analysis of all our sales in 2018 shows that 92.51% of all auction campaign properties sold either before the auction, on auction day or within 9 days of the auction. Not only did they sell but they sold for a much higher amount and in less time than properties sold using the private sale method. In fact, the average auction campaign achieved a price that was 7.13% over the marketing price.”
“So while auction clearance rates are a good broad indicator of the market, it’s always wise to dig further into the figures and make decisions whether to sell or not on facts rather than headlines”, Mr McCarthy advised.