SQM Research has released its Stock on Market data for February, which showed that the number of for sale listings nationally fell a further 2.7% to be down a whopping 13.1% year-on-year.
Listings are down heavily everywhere except Melbourne and Sydney, which have both recorded rising listings year-on-year:
Total Australian Property Listings – SQM Research
The overall decline has been driven by old listings (i.e. greater than 180 days old), which have fallen 26.7% year-on-year, with all markets except Melbourne registering decreases:
Old Australian Property Listings – SQM Research
This has been only partly offset by new listings – defined as those less than 30 days old – which have actually risen 6.0% year-on-year:
New Australian Property Listings – SQM Research
According to SQM managing director Louis Christopher, the fall in overall listings points to high absorption rates as property “demand is swamping supply”:
The key takeaway from February’s property listing numbers is that despite the rise in new listings nationwide (year-on-year and month-on-month), absorption rates are picking up pace, so much so that total listings actually fell over the same period. Right now demand is swamping supply. And nowhere more is this the case than in regional Australia.
Louis Christopher’s findings are confirmed by CoreLogic’s February property market report, which showed that for sale listings are running at record low levels:
Total and New Property Listings – CoreLogic
At the same time, house sales are running well above the decade average, suggesting buyer demand is running way ahead of market supply:
Australian Property Sales – CoreLogic
According to CoreLogic’s Tim Lawless, the current state of the market is one where “buyers are likely confronting a sense of FOMO which limits their ability to negotiate”.
Add cheap mortgages into the mix and gross rental yields that are well above mortgage rates (outside of Sydney and Melbourne), and you have the recipe for rising property prices.
