Increase in listed properties will drive property prices down further: SQM

The increasing number of properties available for sale in November will put more downward pressure on house prices, according Louis Christopher, managing director of SQM Research.

According to SQM Research calculations,  stocks increased by 1.5% in November to 388,848 nationally, with an additional 5,631 properties available for sale.

At the current level of stock, Christopher says the market is now “generally considered to be oversupplied” meaning it is easier to find properties to purchase, reducing demand and competition.

Christopher says national stock on market figures are “undoubtedly edging closer to levels reached in late 2008 – a period where house price falls were recorded in many parts of the country”.

House prices started falling back in the September quarter of 2010 when stock levels were at a much lower 307,000.

“Much still depends on the events on Europe. A credit squeeze event would certainly postpone any recovery here and would cause a continuation of the current price declines right through 2012. Certainly for now it means those who are buying in this market are taking a bet on Europe.”

Source: SQM Research

The only capital cities to experience monthly declines in stock levels were Brisbane and Darwin, falling by 0.1% and 0.5% during the month of November and coming to a total of 30,205 and 1,575 respectively.

The capital city to experience the largest monthly growth in listings was Canberra, climbing by 5.9% during the month of November and coming to a total of 2112.

Over the past 12 months to November, the stock of listed properties up 16.7% with the biggest rises in Hobart (47.9%), Melbourne (47.2%), Canberra (21.5%) and Adelaide (21.3%).

Sydney listings are up 16% for the year with Perth the only major city to experience a decline in listings over the past year, down 0.8% to just over 20,000 listings.