Why are QLD/SEQ/Brisbane Auction Clearance Rates so low compared to the rest of the nation?

I get a weekly email with the saturday auction clearance rates, and it always surprises me why the clearance rate in QLD is so low compared to the other big cities.

I get that Melbourne and Sydney are very hot places with clearance rates consistently in the 70-85%, that makes sense. What doesn't 'make sense is why Brisbane is always 40-50% over the last few years. Moreover, even places like South Australia, Western Australia and ACT are higher despite all having less scheduled auctions.

Auction Results & Saturday Auction Clearance Rates

Victoria
75%
Clearance rate*
687 scheduled auctions

New South Wales
81%
Clearance rate*
1243 scheduled auctions

Queensland
42%
Clearance rate*
410 scheduled auctions

South Australia
71%
Clearance rate*
170 scheduled auctions

Western Australia
58%
Clearance rate*
74 scheduled auctions

Australian Capital Territory
82%
Clearance rate*
90 scheduled auctions

When investors were polled recently, I heard most thought Brisbane/SEQ was the best place to buy now. Then why on earth are the Auction clearance rates so low here? It feels like such a statistical abnormality, that happens week in, week out.

 

Regardless what source you use, Brisbane is behind every week to Sydney, Melbourne, Adelaide, Canberra and Perth.

Latest Auction Results – Saturday, 22 October 2016

Brisbane Real Estate Auction Results

 

It's a cultural/norm thing. Brisbanites just don't like (are not used to) auctions.

Auction for something unique, sure. Anything ordinary that goes to auction is from greedy vendors who think they will get more and mostly get nothing.

 

Here's a story about vendor greed.

We offered 320k for a property a couple of months ago. It all fell through when the bank val fell way short.

It went to auction yesterday, and we pulled out at 240k when it became clear that there was a dummy bidder and we were the only interested party. Not surprisingly, it then passed in.

Stupid.

Looking forward to the phone call. The market has spoken as to what its worth.

 

i personally wont go to auctions i dislike them, agent under quotes you, unless you know the area extremely well it may be worth going.

 

Isn't it illegal?? How did you spot a dummy btw? Flat market?

 

Love buying at auction in Brisbane. Nobody has a clue

 

The number of qld wide auctions held per week appears to have increased dramatically in the last 6 months. Can anyone explain this? Though as mentioned, unless it's an unusual property or close to water, they generally all get passed in.

 

This graph appears to be based on preliminary results only (clearance rates fall another 5% on average over the rest of the week) and includes only bris results?

We're around 2014 rates and slowly falling. Sloooow is good

http://blog.corelogic.com.au/wp-content/uploads/2016/10/20161024-Brisbane.png

 

Markets within markets...get on the ground......stats are dated....

 

Don't knoe, but I can see this as being very true.

 

I think stats are useful because they reveal a trend

 

Probably, but how would you ever know? The dummy just never has to reach the reserve, right?

We can't be sure of course, but the other bidder was the same unique demographic as the seller, and as a generalisation, that demographic would NEVER buy this unique property. It's hard to explain, but the non-verbals just didn't make any sense with what was happening. The person just looked and acted exactly like a plant.

We actually think there were going to be two... we happened to recognise the second party as a person with an existing interest in the property. They were very shocked to see us. Again, no proof, but we suspect they changed tack.

The property is of particular interest to us, again for a unique reason that is literally not applicable to anyone else - it's all quite comical really.

 

True...but only in moderation..it requires follow-up on the ground...

 

Paddington, new farm, milton, west end, Spring hill (referring to houses only) are almost all auctions. From what I've seen about 70% at least will sell by auction.
The inner city is definitely auction territory and buyers sellers expect that. Middle and outer suburbs.

 

Sunnybank and surrounding suburbs are nearly all auction now, with outstanding prices resulting.
Marg

 

People in QLD don't like auctions as a rule. Our contracts are very buyer friendly so there is a large difference between

1. Normal sale - putting a property under contract with 14-21 days finance clause and 7-14 days building and pest clause that lets you terminate and get 100% of your deposit back;
2. Auction- unconditional instantly.

 

Yep. it's changing though..although at a slow pace. Brisbane is a small place and will take time for this cultural shift to more significantly take hold as it has down south.

 

I tell friends and associates (building on the above post ) if you're bidding at Auction in Bris inner city......go hard. A lot of buyers think when you're strong and quick out of the blocks they don't have a chance so they pull back quickly putting you in the box seat. And if you don't make the reserve you'll get first crack at it if you still think its value buying.

Also the majority of agents wont sell auction as a method of sale because the demand hasn't been there to justify it, and the majority of agents are still so scared they'll lose a listing if they use the word auction.

 

But we learned last week that stats are facts, especially when discussing avocado

(sarcastic face)