Nervous vendors withdraw from teetering Aussie housing market

SQM Research has released its stock on market report for June, which revealed that listings nationally fell another 1.0% to be 6.2% lower year-on-year:

SQM property listings

The decline was driven by new listings (less than 30 days), which fell 5.4% in June:

SQM new property listings

By contrast, old property listings (greater than 180 days) rose by 1.6%; although they are down 31.1% year-on-year:

SQM old property listings

Commenting on the result, SQM Research’s managing director, Louis Christopher, noted that vendors are less confident to list their homes amid falling prices, whereas older listings rose on softer buyer demand:

The fall in new listings was a result of reduced vendor confidence in the strength of the housing market as well as seasonal factors whereby the winter period normally records a decline in residential property sales activity, particularly for Sydney and Melbourne.

However, older listings rose. This reveals the slowdown in the housing market driven by lower buyer demand. Going forward we expect July to record similar trends of lacklustre activity and more rises in older listings.

Separate listings data from CoreLogic also showed “the flow of new listings added to the market falling as selling conditions becoming more challenging and listings move into a seasonal lull”:

CoreLogic listings data

The fall in listings is helping to balance the market, given buyer demand has slumped as indicated by the fall in sales volumes:

Australian property sales volumes

If listings were rising at the same time as sales were falling, that would spell danger for the property market.

Unconventional Economist
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Comments

  1. haroldusMEMBER

    FONGO FONGO FONGO CARNTS

    To quote Kenny “You got to know when to walk away and know when to run.”

  2. DingwallMEMBER

    Yep “nervous” is not enough. The edge of panic needs to arrive….. please. Home owners are still of the belief their house, if put on market, should still go for $100k-$500k plus over the reserve…. Because that is “normal” lol

  3. Goldstandard1MEMBER

    haha, if only they knew that it’s only worse for vendors into the foreseeable future. Sell now or lose more. It’s very simple maths at this point because you won’t ride out a dip because it will be longer than 12 months. Once sales start moving beyond 10% declines you’ll finally see rents follow.
    It is the way.

  4. Look at those Adelaide and Brisbane figures, 17-20% reduction in stock on market and that is based on 2021 levels, Brisbane averaged close to 30k listings pre COVID and its 18k now. Stark contrast to the Sydney and Melbourne markets.

    The average punter in those markets has seen equity skyrocket and you would have to assume that the average punter that migrated from Sydney and Melbourne did so with a significant difference in borrowing capacity and/or equity, therefore even with a decent correction very few will be forced sellers.

    One could certainly see a scenario where the relative performance of those markets ends up totally disconnected from that of Syd and Melbourne, so long as overall employment holds up.

    interesting times

    • SkepticviewerMEMBER

      Yes add to this cashed-up mass immigration with the need to own several houses and Brisbane will become ultra unaffordable the wild cards are employment and the new Covid.- Brisbane does not have a lot of industrial base to maintain employment in rough times – just house building and tourists, things can go bogan a the drop of a block of coal.

      • Agreed, QLD govt should be thinking of incentivising (or at the very least, encouraging) syd/mel centric industries to consider Brisbane bases. Financial services is a big one, the line from the top was always “Sydney and Melbourne are the global cities” but when you speak to international managers, their care factor is far less. My argument now is, If the like’s of state street, black rock, goldman etc can leave NYC for palm beach, Nashville and Houston don’t tell me a comparatively tiny fin service sector can’t do Brisbane.