A lot of emphasis is put on clearance rates each week, particularly in Melbourne and Sydney – the two main capitals for auction sales – however few people really understand what the clearance rate represents.
BY CATHERINE CASHMORE
The broad assumption is that ‘sold at auction’ equates to sold ‘under the hammer’ and a high clearance rate means the market is ‘flying’, while low clearance rates depict the opposite. However it’s not quite so simple.
The clearance figure released on a Saturday afternoon factors in every property that has sold under the hammer, as well as those sold via post-auction negotiation. And in our experience, more homes sell via negotiation.
