Drop off in auctions but Sydney still strong

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Auction clearance rates softened on the weekend, with the preliminary clearance rate across the combined capitals falling to 73.0% from 77.1% last week.

However there were a lot less auctions held this weekend, at 1,227, compared to last week’s 2,395, according to Core Logic RP Data.

Melbournians – who were lucky enough to have a Labour Day long weekend – were a big factor behind the decrease in total auctions.

Weekly clearance rate – combined capital cities

Sydney was one of the property markets to maintain a steady clearance rate compared to the previous week – coming in half a percentage point higher – with 83.3% of total auctions cleared.

Melbourne’s rate dipped slightly, coming in at 73.7%, compared to last week’s 76.5% as total auctions fell to just 373 from 1,539 last week.

Adelaide and Brisbane also experienced a broad decrease in the amount of auctions held compared to the previous week. Adelaide almost halved its number at 59 (compared to 110), while Brisbane’s number fell to 153 (compared to 214).

Capital city auction statistics (preliminary)

Refinancing tips

For those with a variable rate mortgage, it’s good to keep in mind a few handy tips if you’re considering refinancing.

Switzer Super Report expert Penny Pryor says it’s imperative you look at the comparison rates rather than the “rack rates” when you size up the loans offered by different lenders. The comparison rate includes all of the lender’s fees and charges and therefore is much more transparent.

The second tip is considering if your circumstances have changed since you took out your first mortgage. “Once you’ve discharged your loan, you’ll need to go through the whole application process again. So, for example, if you started working for yourself since you took out your first loan, your new lender might want a bit more collateral, and information about your company, before it approves the new loan,” Penny says.

The third, and perhaps most important tip, is to look to any exit or “break fees” that might come with refinancing. Exit fees aren’t allowed anymore under new legislation – unless of course, you’ve got a fixed-rate loan – but if you’ve taken a loan out before 1 July 2011, you’ll need to do some due-diligence to see if any charges apply to you. For more insights on the costs associated with refinancing, you can view the full article here.

Important: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. Consider the appropriateness of the information in regards to your circumstances.

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