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Jittery sellers making deals before auction

This five-bedroom home at 50 Brook Street, Coogee, sold prior to auction for $3.18 million. This house at 64 Cavendish Street, Stanmore sold before it’s scheduled auction for $1.4 million.
Nanjing Night Net

This house at 64 Cavendish Street, Stanmore sold before it’s scheduled auction for $1.4 million.

This five-bedroom home at 50 Brook Street, Coogee, sold prior to auction for $3.18 million.

This five-bedroom home at 50 Brook Street, Coogee, sold prior to auction for $3.18 million.

This house at 64 Cavendish Street, Stanmore sold before it’s scheduled auction for $1.4 million.

This five-bedroom home at 50 Brook Street, Coogee, sold prior to auction for $3.18 million.

This house at 64 Cavendish Street, Stanmore sold before it’s scheduled auction for $1.4 million.

There are more than 1000 homes scheduled for auction on Saturday but buyers will be disappointed to hear that a large chunk of those properties have already sold.

Spooked by falling clearance rates and the prospect of competing with an unprecedented flood of listings, sellers are increasingly accepting offers prior to auction, new data from the Domain Group shows.

In November, there has been a dramatic jump in vendors selling prior, with almost half of all properties that have sold via auction campaign being snapped up without a hammer falling.

The senior economist for the Domain Group, Andrew Wilson, said the shift towards selling prior “was a sign of the turn of the market”.

“It’s no longer about buyers grabbing property, it is about sellers grabbing buyers,” he said.

According to the figures, 2765 properties have been reported sold via auction campaign this month with 1256 – 45 per cent – occurring before the scheduled auction date.

In October, just 37 per cent sold prior and  it was a similar scenario in September when 38 per cent sold before auction.

Unlike last year, which was consistent at about 40 per cent for all of spring, this year there has been a significant shift. Dr Wilson said that showed sellers were “getting nervous”.

Agents are reporting that in some parts of Sydney the lion’s share of auction campaigns is not eventuating in an auction.

“In the inner west and inner east Sydney I would suggest 70 per cent would be selling prior to auction,” said Matt Hayson of Cobden & Hayson.

“You have Christmas bearing down upon sellers, you’ve got a lot of stock on the market, you have agents fighting for buyers’ interest … there is definitely a shift towards selling prior,” he said.

Mr Hayson said during the past few months “a heap of property has sold, which has wiped out a huge pool of motivated ready-to-act buyers”.

“You would think the market has peaked.”

Despite this Mr Hayson said that sellers were “still getting good pre-sale offers”.

The agent with the most auctions on Saturday, Brent Courtney from McGrath Lane Cove, said more than half the auctions scheduled in his area were selling prior.

“Owners don’t want to take the risk of going to auction,” he said.

Shannon Whitney from BresicWhitney said it was a seasonal phenomenon with sellers typically more inclined to sell prior to auction in the final months of the year.

“If you don’t end up selling at auction you don’t have an after-sale period, you have Christmas,” he said.

Last weekend BresicWhitney sold one out of the six properties that went to auction on the Saturday, but five other properties scheduled for Saturday were snapped up beforehand.

The competition among sellers will also be fierce in December. Next weekend there are just shy of 1000 auctions scheduled and the following weekend there will be more than 800.

Dr Wilson said we are still in a sellers’ market but with so much stock coming up for sale, this December could “spell the end of the ball game”.

This story Administrator ready to work first appeared on Nanjing Night Net.

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