Auctions thrive as market slows down

The nation's auction results are stronger than ever this year, as a growing number of buyers sit up and take notice of this method of buying property. Figures from the Real Estate Institute of Western Australia (REIWA) highlight just how popular auctions have become in the state, especially as properties can be bought and sold much more quickly.

At present, an auction reduces the average time a home spends on the market by around 26 days. Over the past five years, an auction property has spent an average of 39 days on the market, which compares to around 65 for private treaty.

However, Western Australia still has some way to go before it catches up with the rest of the country, as REIWA deputy president Hayden Groves reveals just 2 per cent of Perth sales are completed in this way. This compares to as many as 40 per cent in Melbourne and Sydney.

"With the number of properties on the market growing every week, more and more sellers are looking for the best ways to stand out from the competition and to sort the genuinely keen buyers from the casual lookers and the undecided in a weakening market," Mr Groves noted.

In a 15 December interview with Smart Company, RP Data's Robert Larocca explained that this year has proved a turning point for the auction market. More people have sold homes at auction in 2014 than they did last year, with the clearance rate also expected to beat 2013's.

Auction volumes have been particularly strong in Sydney, with Mr Larocca admitting that the Harbour City has now started to catch up with its Melbourne counterpart. Although markets have started to soften as the year draws to a close, he believes this is a trend that typically occurs over the festive season.