Canberra's auction clearance rate has dropped to the lowest point since July 2019, according to new data.
Domain's Auction Report for November revealed Canberra's clearance rate for the month was 54.3 per cent, a 8.6 percentage point drop from the month prior.
The data also revealed of the 461 auctions scheduled in the capital in November, 209 sold at auction and 103 were passed in. The number of homes that sold prior to their scheduled auction was 19 per cent, and 11.9 per cent were withdrawn altogether.
November's auction clearance rate also dropped 25.1 percentage points year-on-year, falling from 79.4 per cent from the year prior.
With the change in the success rate of homes selling within auction proceedings, Jacob Stanton of The Property Collective said agents have had to change their strategies to work with the changing market.
"The key to a successful auction campaign is good communication from the agent to the buyers and sellers, based on recent comparable sales data from the market," he said.
"There needs to be an understanding that, with lower clearance rates, there will need to be more work involved in finding the right buyer and being educated on the likely price point the market will perceive the value to be."
Mathew Kocic of Canberry Properties said there's an increased need to be transparent with buyers and sellers to make them see the positives in a market that is changing, Kocic added.
"In the past two years, buyers were aggressive in making offers at and often prior to auction, but there is a greater level of focus now in making them feel comfortable with the opportunity in front of them," he said.
"Good results will still occur if the prep work has been done prior to auction day, meaning the vendor has listened to the buyer feedback and has a realistic price expectation, and buyers know what to expect on the day.
"This is just the fundamental and necessary background work that gets done prior to game day and still garners good results."
Despite achieving good sales through the auction process, Stanton said agents have been considering private treaty sales more as a result of the drop in clearance rates.
"Advertising with a price can help to attract buyers and sellers on recent comparable sales using data and feedback from the market," he said.
"They also allow buyers who require unconditional finance approval prior to exchanging contracts the option to compete or offer on the property.
"Lower auction clearance rates do not equate to lower prices; it just means that fewer properties advertised for auction are selling before or on auction day."
