Auctioneer Ben Mitchell outside a property set to be auctioned this weekend. Pictures: KIRK GILMOUR
Crowds outside a Shell Cove home that sold at auction.
Auction mania has hit the Illawarra, driven by a shortage of homes on the market that is generating fierce competition among bidders.
The number of auctions in the past three years has remained steady but the clearance rate so far this year has hit a high of 58 per cent, significantly outgunning the previous two years, according to Australian Property Monitors figures.
In 2011 the clearance rate by early March was 31 per cent and in 2012 it was 33 per cent.
"I'm loving it," says Ray White's Illawarra and Southern Sydney auctioneer Ben Mitchell, who has called 28 auctions in the past week with a combined 600 people, 128 registrations and hundreds of bids.
"Last year we averaged 1.2 bidders per property and that has jumped to 4.5 bidders in the first two months of this year," he said.
Real Estate Institute (Illawarra) chairman Trever Molenaar acknowledged agents were struggling to find new listings but he was reluctant to pin that on any specific reason.
"An uncertain political climate can add to the supply shortage, with vendors sitting tight for a while."
But he said the higher interest in auctions went beyond simply supply and demand.
"It could have something to do with agents in the region gaining a better understanding of the auction process, which is a lot fairer since the government weeded out malpractice with heavy fines for phoney bidders."
Troy McNeice from McGrath Thirroul said his most recent auction, a knock-down in Ocean Avenue, Woonona, attracted 16 registered bidders and sold for $723,000 - $43,000 above reserve.
"We were lucky to get three bidders at most of our auctions last year," he said.
Maria Field from Coastside First National Shellharbour, said she had sold three properties at auction, two on the day and one two weeks later, and all were over reserve price.
"What I'm noticing more is that the lower-priced properties under $400,000 are attracting more bidders than the high end homes," she said.
Colliers International principal Simon Kersten put the heightened auction activity down to normal cyclical fluctuations in the market.
"You can't read too much into clearance rates because Wollongong, unlike Sydney, is not traditionally an auction city," he said.
"Sydney probably sells about 90 per cent of its stock in auctions while Wollongong has traditionally sat closer to 50 per cent."
TOP TIPS
Domain.com property expert Stuart Benson’s tips for first timers.
• Do your research so you can put a real, personal value on the property – how much is it worth to you?
• Be flexible on your limits – missing your dream home for the sake of an additional bid may haunt you.
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