Damien Cooley

Yeah, so markets are driven by a number of things and we collect auction data that really signifies how the market is tracking.

One piece of information is what we call auction clearance rates.

An auction clearance rate is the percentage of property that sells either before or on the day of the auction compared to what property is actually being listed to go to auction on any given date.

Another piece of information that we use is how many buyers are actually registering at auction and how many of those buyers are actively bidding at auction.

So there's a few things that I'll just touch on now that signify change in market.

One of those is that auction clearance rates have reduced, come off their highs.

We look at a market and we say a normal real estate market has an auction clearance rate between 50 and 60%, a good market between 60 and 70%, a strong market is above 70% to 80%, and a boom market is 80% plus.

We've come out of the back of arguably one of the largest real estate booms in the country's history.

We're now just at the moment sitting in what we define as a good market, and that's a clearance rate sort of between 60 and 70%.

The average number of bidders in that boom market, we saw even post lockdown periods,

We were averaging upwards of seven, in some cases 10, not necessarily active, but 10 bidders at every auction.

Whereas now we look at even the weekend just gone past, our company had almost 100 auctions on Saturday and we averaged just over four bidders at every auction.

There are different markets within markets.

So we speak generally, but every market has its own little micro market.

For example, Sydney has different locations like the eastern suburbs, the lower North Shore, the inner West.

Each of those markets is generally performing at a lower rate than what it was previously.

With the active number of bidders reducing, you can understand now, given that explanation, how

If less people are competing for a property, it means less properties are selling, which means it's harder to sell, which means prices will come back.

Real estate market, I guess, is driven, as I said, by confidence and it's driven by the ability to borrow money.

So what we need to look at is what are the factors that are influencing this data now?