Number of homes for sale rises, rentals fall

By Leith van Onselen

Late last week, RP Data released its latest Industry Market Wrap, which contains data on the number of homes for sale and rent, as well as the latest auction clearance rates.

The below table shows the number of homes for sale in each state and territory, as well as nationally. Note that I have included the year-on-year percentage movements in red.

As you can see, the number of homes for sale have increased in all markets compared with the same period last year. The increase is particularly pronounced in Victoria, although the absolute number of homes for sale is by far the most elevated in Queensland.

The situation is different for the rental market, where the number of homes for rent nationally has actually fallen compared to the previous corresponding period:

Again, Victoria has experienced the largest percentage increase out of the mainland states and also has the highest number of homes for rent. Queensland, too, seems to have quite a lot of slack in the rental market, albeit less than at the same time last year. Western Australia’s rental market, by contrast, appears to be very tight.

Finally, RP Data has provided auction clearance rates for the week ending 25 March, which are nothing spectacular:

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Comments

  1. In Vic surely this oversupply should equal drops in price?

    I would also imagine that this is also in large part made up of Apartments in Vic?

    Thanks for the post.

    TM.

  2. I think that the headline should read “Number of homes for sale rises, rental homes available fall”

    The way it reads at the moment gives the idea that the cost of rental is falling, which it isn’t.

    Houses available for rental in Qld have indeed fallen, with demand outstripping supply in many areas.

    Listings are increasing because homes are selling, but wow look at the huge increase in homes on the market in Victoria YOY although the rate of increase may have slowed.

    • “The way it reads at the moment gives the idea that the cost of rental is falling, which it isn’t.”

      Why? It’s quite clear: It reads Rentals Fall, not Rents Fall.

    • dumb_non_economist

      Peter,
      To interpret it that way it would have to say ” rents fall” not rentals.

    • The way it reads at the moment gives the idea that the cost of rental is falling, which it isn’t.

      cost of rentals are most certainly falling in melbourne

      • JunkyardMEMBER

        …and we finally got our landlord to put in Aircon last week. After asking each year for the past 3 years.

        It was a bit of a surprise actually. As he’s just refused each year, then all of a sudden an aircon guy turns up to do a measure and quote. 4 weeks later it’s installed.

  3. Jumping jack flash

    Selling up the investment properties after taking them off the market?

    It makes sense, few people want to rent a place on the market, and if they do it is usually at a discount. Real estate agents would probably discourage this because it has the potential to skew already ridiclous rental prices. (ridiculously low compared to house prices!)

    Combine this with the increased risk of damage from having someone renting the place you want to sell, with the potential to discount the already falling price.

    Yes, real estate agents would probably discourage this.

  4. All the vendors want the old price. They know they just have to wait on-market for their magic number, the peak.

    Meanwhile, the auction clearance factoid reflects buyer indifference. Stock clearance isn’t happening.

    How long can anyone hold their breath?

    Don’t Buy Now!

    • It is the smart investors, who probably read MB, who are hunting the ever dwindling numbers of greatest fools.

      Their Mantra has become..

      Do Sell Now!

      • Mining BoganMEMBER

        The smart investors are long gone and drinking margaritas on a nice Jamaican beach.

        It’s only the true believers left. Those who think that the 10% annual growth is just around the corner. All they need is a little bit of stimulus and a little bit of rate cut in the witches brew…

    • I have first hand experience with manipulation of auction clearance data. I attended auction of one of the units where I live. One person interested in buying + my family were only people attending, agent didn’t even bother to read the contract (person interested in buying had a copy). One vendor bid ($400,000). Property was passed in.
      Property was not included on weekly auction results.
      I don’t think this was isolated incident.
      On Monday I received email from the agent that property is now available for private sale.

      Price $435,000

      good luck:)

      • Most cases I’m seeing the agent includes the auction ‘charge’ within the commission.

        A mate sold recently in a blue chip sub $1m, agents viciously undercutting each other for 1.3% incl GST and auction. I’d be surprised if anyone was silly enough to pay those $5-10K auction charges that we’ve seen in the past.

      • The manipulation seems rather obvious from the eternal/reliably downward revision of the clearance rates reported at the weekend to the figures reported mid week. The practice is so obvious yet the rates retain a high profile.

        My persoanl anecdote 111 Surrey Rd North autioned 12.30pm last Saturday by Hocking Stuart. Passed in on vendors opening bid – a crowd of 30 and not a squeak from anyone. Not reported in Domain Sunday.

      • thomickersMEMBER

        I seriously don’t understand the rationale of the vendor after a VB result. i saw a 700-770 (2010 price) apartment without a squeek but a VB and it goes on private sale at the reserve of $820k (2010 price + con premium).

  5. Isnt it common sense that an increase in number of house put up for sale by landlords baling out will result in a temporary decrease in rentals?

    I don’t know why Spruikers persist with their rents to the moon logic.

    • [email protected]MEMBER

      1;yes
      2; me neither

    • dumb_non_economist

      Mav,
      If that’s correct (1st one) you’d expect to see a similar % increase in the number of homes on the market and from what I’ve seen in Perth that isn’t happening.

      • Well, no. That assumes a stable population and stable stock of housing and everyone either rents or buys. Perth clearly has a net gain in population. Many of whom perhaps do not intend to buy/stay forever. So, rentals tight.

  6. From a WA perspective, Landgate indicates that monthly total sales range around the 1500 mark. If there are 6475 new monthly listings and total stock of 34100 then I would suspect a lot of relisting every month.