Sellers will return to housing market
THE property market has been on an upward trajectory from the moment a COVIDinduced bust failed to materialise mid-last year.
While buyers were quick to regain confidence, hitting the market in force – figures this week by CoreLogic show borrowing for a residential home reached a record $28.8bn in January, up 34.8 per cent on the decade average – sellers have been slow to jump on the boom bandwagon.
The result has been a demand-supply imbalance, which is pushing the market into unprecedented territory when it comes to prices.
So much so, it’s almost impossible to keep up.
Street, suburb and state records continue to be broken by Gold Coast properties, equating to record sales figures being pushed out by estate agencies. Last week Ray White revealed it sold $1.4bn worth of property across Queensland in the past month, while nationally the figure was $8.74bn, up a staggering 92 per cent year on year. The figures are mindblowing, but a change may be on its way.
According to website Realestate.com.au, there are signs sellers may soon start to return to the market.
Realestate.com.au director of economic research Cameron Kusher said COVID had introduced a lot of uncertainty, prompting sellers to sit tight while they waited to see what happened.
But the group’s Property Seeker report, which surveyed more than 6000 property
owners, showed sellers were regaining confidence after watching the coronavirus situation improve and the economy recover.
“I expect supply to increase for the next few months and ramp up quite a bit during spring, assuming we aren’t forced back into lockdowns at some time,” Mr Kusher said. “We are seeing a significant increase in the volume of sales so far this year compared to recent years and the supply of stock is increasing, albeit the rise in supply
remains insufficient to demand.”
Mr Kusher said as more people purchased homes, there may be a better balance between supply and demand later this year.
Some agencies are already recording rises in stock levels.
Dan White, managing director at Ray White, said listings across the group were up 16 per cent in March compared with the same time last year and 10 per cent up on levels in December.
“Contrary to much market relative
commentary, there is no shortage of new listings,” Mr White said. “There is more new stock coming to market now than there has been for many years. As we look forward to April and May, we see continued strong listings numbers off the back of the numerous market appraisals currently being conducted.”
Market conditions, led by booming house prices and record low interest rates, are the key driver for sellers today, as opposed to a lifestyle change.
And those who are entering the market are doing so with high expectations.
Market research and insights manager Kirstin Hodgson said when the same research was conducted in 2019, vendors were expecting to achieve on average $650,000 for their home.
“In 2020, we saw fewer vendors expecting to sell in the sub-$400,000 range and more expecting to sell in the $1m to $1.5m range, pushing the average to $665,000,” she said.