The Sydney auction market has held at last week’s clearance rate despite being flooded with high auction numbers ahead of the Christmas holidays. The harbour city is still experiencing the lowest clearance rate levels for three years ahead of the Reserve Bank December interest rate meeting with official rates likely to remain on hold. Meanwhile the Melbourne market is showing resilience despite the consistently high number of auction volumes each week. This past weekend, more than 1600 homes went under the hammer in Australia’s biggest auction day in history.
Real estate figures
Construction work has fallen faster then expected in the September quarter. The latest figures from the ABS show total construction work for the three months to September slipped 3.6 per cent, well above expectations of a 2 per cent drop. The fall is blamed on a 7.3 per cent fall in engineering work as the mining sector continues to slow. Housing construction remains strong with residential construction up 2 per cent in the quarter for a gain of 12.4 per cent over 12 months.
And a new Rental Affordability Index launched by National Shelter, Community Sector Banking and SGS Economics and Planning shows that Sydney has almost no affordable rental housing for low income earners east of Blacktown. The report says low income earners were forced to pay up to 70 per cent of household income on rent. The problem is ‘dire’ in most capital cities across the nation but in NSW almost all renters along the coast and inland to Orange and Dubbo were on the threshold of housing stress.
Australian auction results
Looking at this week’s auction results across Australian capital cities - Sydney recorded a 59 per cent clearance rate from 1065 properties for auction, Canberra posted a 58 per cent clearance rate from the sale of 70 properties by auction. Melbourne cleared 66 per cent from 1619 properties, Brisbane had a 51 per cent clearance rate from 149 properties listed and Adelaide cleared 61 per cent from 116 listed auctions.
Commercial property sector
Diploma Group Limited (ASX:DGX)
has won a $52 million contract to design and construct the 18 storey Riverwood Apartments complex in Perth.
CIMIC Group’s (ASX:CIM)
construction company Leighton Contractors has been awarded a $274 million defence contract for the redevelopment of the Williamtown RAAF base in New South Wales.
Sunland Group (ASX:SDG)
says it had strong demand for its unsecured note offering and consequently oversubscriptions of $10 million were accepted, increasing the offer to $50 million.
And Lend Lease (ASX:LLC)
has hosted a ‘topping out’ ceremony for Tower 3 at the Barangaroo complex which is due for completion mid next year.