Just how much Sydney property listings have shrunk: CoreLogic
CoreLogic data shows settled transaction numbers have levelled over the most recent three months.
At just under 110,000 settled transactions, sale numbers are down 5.3% compared with the June quarter.
They are 15% lower than the September quarter last year.
There are fewer than 20,000 dwellings currently being advertised for sale across Sydney, which is less than half the number of homes that were listed for sale five years ago.
CoreLogic head of research Tim Lawless said reduced stock levels create urgency in the market, adding to the upwards pressure on dwelling values.
“Conversely, in markets like Perth and Darwin, where dwelling values have been falling consistently, the slowdown in transaction numbers is related to demand, which is evidenced by the higher number of homes available for sale, as well as the sharp slowdown in migration rates.
"With advertised stock levels close to record highs in Perth and Darwin, buyers now have a lot more choice when selecting a property and can negotiate hard on price,” he said.
Perth and Darwin have consistently been recording the highest vendor discounting rates at just over 8% on average, as well as the longest average selling time at 75 and 84 days on average.
As the spring selling season progresses, CoreLogic is now seeing a rise in newly advertised listing numbers, however, there are fewer newly advertised properties entering the market compared with a year ago across the combined capital cities.
Lawless said the weaker new listing trend is mostly attributable to the Sydney market, where newly advertised listings are 18% lower than the same time last year.”
“Interestingly, real estate agent activity across CoreLogic platforms, as measured by the CoreLogic listings index, has been tracking higher than a year ago, despite the lower amount of fresh stock being added to the market. Increased levels of agent activity translating into fewer new listings indicates a heighted level of competition amongst real estate agents for listings. Sellers may also be nervous about selling in a strong market, especially with the consequential challenges of buying well in that same market.”
According to Mr Lawless another factor affecting transaction counts is the level of undercounting due to the record-high number of off-the-plan sales yet to reach settlement.
As off-the-plan units move through their settlement phase, transaction numbers will revise higher, he said.
He also suggested despite the low mortgage rate environment, high transaction costs may also be a disincentive for the lower numbers transacting in the housing market.
"Due to bracket creep and higher dwelling values, we’ve also seen stamp duty dollar value payments rise substantially.
"In addition, percentage-based expenses such as agency commission fees for vendors have moved higher as the value of housing rises.
"It is likely that an increasing number of home owners are weighing up the pros and cons of the costs associated with selling and buying, or, staying where they are.
"It seems an increasing number, particularly in Sydney, are choosing the latter.”
“Clearly, many factors are at play across Australia’s housing market. In fact, there isn’t just ‘one’ single housing market nationally, there are a multitude where conditions vary substantially by way of geography, housing type, and price point,” he said.