zero percent clearance rate

This, taken from another forum, however thought it was pertinent to the discussions on this site.

We can argue till we are red and blue in the face, but nothing will change reality (Yes, and it is NSW and not WA).

I suppose if anyone has any doubts, give L J Hooker a call..


A MARKET IN WITHDRAWAL

Zero Percent Auction Clearance Rate

Group action L J Hooker, Newcastle Travelodge 6 PM 17 4 08.

14 Properties on the order of sale

This evening I had an opportunity to attend a full group auction; from the 1st property to the last. I ask myself, what succinct phrase best describes my observation ? That which immediately comes to mind is A MARKET IN WITHDRAWAL.

A drug addict can do strange and bizarre things when denied a narcotic elixir coursing through his veins. So can a market and it's pundits do strange an alarming things, when denied the 'manna from heaven' (easy debt, perpetual capital gains, etc) that it has come to rely on as badly as any pumped up druggie.

The results were just plain sad - and vendors and agent were starring into the abyss and knew it.

Order of Sale, and Results;

1) 17 Eltham St Rathmines;
Mid range house, good block, lake views

- Opening bid 230k.
- No other bid; auctioneer declared it was well below reserve and couldn't sell.
- ... and then, another one of those strange affairs, where auctioneer neither sold it under the hammer, nor passed it in ... no, he left the bidding open to come to it later (see after prop 2)

2) 14 Eagles Nest Drive Belmont North;
Luxury home on 2.5 acres near water with lake & bush views.

- Opening bid was immediate and urgent ... a sharp, controlled male voice behind me at ... 1M. (The cynic in me thought "Hey, I thought undeclared vendor bids were illegal !").
- No further bidding.
- Within 30 seconds, same voice, in same controlled urgent manner, increase his initial bid to 1.05M. I thought "hmmmmm"
- No further bids, property passed in at 1.05M

At this juncture, auctioneer resurrected prop 1, and called for more bids. None were forthcoming. He then said something strange and confusing - he said...
"Ladies and gentlemen, I'm going to pass the property in at 230k, however, the initial bidder, who has now left the room, has increased his bid to 270K, however, as I didn't get his bidder registration number for that bid, I must pass the property in at 230K" (I paraphrase, but that was the gist of it).

And I'm thinking to myself "hmmmm, he (the departed bidder) was the original bidder - didn't you get his rego number then?"

And I'm further thinking to myself ... "Strange days indeed" !!!

3) 7 Excelsior Pde Cary Bay;
1,300 sqm land of gorgeous absolute lake frontage. Modest house, boat facilities, etc.

- No Bid.
- Passed in.

4) 37 Bayview St Warners Bay.
Up market 4brm home, classy pool, entertainment area, etc.

- No Bid
- Auctioneer called for 700K, then 680K, then 650K, then ... anything ...
- Passed in

5) 183 Fishing Point Rd Fishing Point;
Luxury home on absolute waterfront position; own jetty, etc.

- No Bid
Passed in.

6) 11 Meridian Close Belmont;
Luxury home described in brochure as 'blue ribbon location'

- Withdrawn prior to auction.
- Auctioneer advises however, that it is for definite sale ... see agents, quick !

7) 31 Defender Close Marmong Point;
Lovely home, elevated, extensive lake views.

- No Bid
- Passed in

8) 13 East St Warners Bay;
"a fabulous home ... yadda yadda" good views (but not lake)

- No bid
- Auctioneer declared that they had a strong buyer who was in the room at the start, but who had to be rushed to hospital minutes ago ... (I'm not kidding).
- Passed in

9) 1 Whitelock St Coal Point;
"Superb waterfront, boat shed, slipway", etc.

- No Bid
- Passed in

10) 29 Boyd St Swansee;
"Fabulous 5 brm home ..."

- Withdrawn
- Auctioneer advised available for sale, but may be auctioned next month.

11) 68 Watkins Rd Wangi Wangi;
3 brm home in "arguably the best position in Wangi ..."

- No Bid
- Passed in

12) 5/78 Thompson Rd Speers Point
Vacant block in 'fantastic position" lake glimpses

- Withdrawn
- Auctioneer advised is for sale to interested purchasers

13) 125 Coal Point Rd Coal Point;
3 brm elevated home, good rental return, lake views

- No Bid
- Passed in

14) 2/78 Thompson Rd Speers Point;
House, lake position, etc

- Withdrawn
- Auctioneer advises is for sale to interested purchasers


Thus it was !

If my math serves me correctly, 14 properties, none sold, that makes a clearance rate of .... ZERO PERCENT !!!

So what's happening here ? I might add, that my attendance of other auctions over the last several weeks, has revealed similar results - hardly anything selling. Example - I attended a Ray White auction last Thursday. I called in at prop no. 3 and left at prop no. 9. None of those 6 I witnessed sold (though I can't speak for the rest - 11 in total).

SO WHAT'S HAPPENING HERE ?

Why am I consistently witnessing a sub 10% clearance rate in the Newcastle / Hunter area ?

Is N / H so much out of step with the rest of the State, and the reported 40%, 50% 60% clearance rates elsewhere in the State ?

If so, why ? Isn't it a fact that N / H has one of the highest (THE highest ?) growth rates in the State, as reported in the press recently ? Isn't it a fact that prices are lower here, and vacancy rates are even LOWER than Sydney ?

What logical reason could there be, for N / H to be so out of step with the State in the auction clearance rates ?

Or IS IT out of step ? Perhaps it isn't ... more or less ....

Perhaps I've been TOO right all along, when I've called the published clearance rates as provided by agents, a "dogs breakfast" and similar euphemisms.

I would like some intelligent comment on this - please don't try to destabilise or divert - I would really like to know what the other intelligent posters here think of this discrepancy !

A final aside; You will see from the brief description above, that most of the 14 properties offered were not lower range, 1HBer stuff (except for the 1st). They were all in the 600K to 1.5M range in my opinion. So, this REALLY begs the question - why are these folk auctioning their places, when it must be apparent to them that they have very little chance of a sale ?