The number of bidders is higher this year than in the spring, although some experts say there are few homes for sale and the outlook for the market remains uncertain.
In Sydney, the average number of active bidders per auction improved to 3.4 in March, after staying below three during last year's spring selling season, according to real estate agency Ray White.
In Melbourne, active bidders rose to 2.8 in February and March, up from a low of 2.2 in November last year.
A separate study by CoreLogic showed that home values rose by 0.6 per cent in March, the first national increase in 11 months. Sydney rose by 1.4 per cent and Melbourne by 0.6 per cent, while the flow of new sales listings was below average.
According to Domain, auction clearances have remained in areas indicating stable or rising prices in recent weeks, with prices even stronger in some neighbourhoods. But Tuesday's Reserve Bank board meeting will provide clues as to whether further interest rate hikes are likely, which could send the housing market back into the red.
Ray White chief economist Nerida Conisbee said the figures coincided with an increase in prices, which she saw as an upward trend, based on the observations of the firm's real estate agents.
"On the ground, our data shows bidding behaviour is increasing," she said." It is also a clear indication that there are people looking to buy at the moment.
"Anecdotally, we're hearing from our brokers that prices do seem to be moving. What wasn't selling a few months ago is now selling."
Matthew Hassan, senior economist at Westpac, said it was too early to say whether the national price rise measured by CoreLogic was part of an uptrend or just stable.
"We need to be cautious about what we're seeing at the moment," he said." The [house price] rise in March, particularly in Sydney, looks rather one-sided.
"Houses and top-end homes are leading the way. The rest looks to be stable."
BresicWhitney CEO and chief auctioneer Thomas McGlynn said the increase in active bidders indicated an increased appetite to buy and was driving prices up.
"That's what's driving the market up, the people who are actively participating," McGlynn said.
He said most auctions he calls now record more than five active bidders, similar to conditions during the 2021 boom.
"Once you have more than five active bidders, it's almost boom conditions," he said ...... It's only a matter of time before we see a positive price rise.
Some auctions achieved impressive results, such as the weekend when a three-bedroom house in Marrickville, Sydney, beat its reserve price by $400,000, or a family home in Kew, Melbourne, beat its reserve by more. Other homes, however, passed, or just exceeded, the sellers' bids.
Hassan said that despite the increase in bidders, the lower number of sales still made it difficult to tell if the market had recovered. He said the elevated auction exit rate showed that vendors were not always able to achieve the prices they wanted.
"If we look at Sydney in March, we saw an average of 15 per cent of auctions being withdrawn prior to the auction," Hassan said." Melbourne's withdrawal rate is 7 per cent and tends to be lower than Sydney's.
"Last year, [Sydney] would sometimes have a 25 per cent withdrawal rate, but it was still quite high. It points to stability, not price increases."
Hassan said any pause in interest rates by the Reserve Bank would not re-energise the property market because previous rate rises had not been fully passed on to the wider economy and the low number of sales meant the data collected was erratic.
"In this case," he says, "you might get a shock one way or another." There is not enough evidence to suggest that prices are trending back up. It appears to be a stabilisation.
"The economy hasn't felt the impact of these rate rises. It looks like we're going to see a stop gap year for house prices.
"When you have a price movement in the 0.5 per cent range, that could be a wrinkle. It's not a rise in prices, it's more the end of a decline."
