The PropTrack Listings Report for July has been released, which reveals that total stock on market has ballooned 4.9% compared to this time last year – “the largest year-on-year increase since 2010”.
In particular, Sydney – which is leading the nation’s housing correction – recorded its largest ever year-on-year increase in total stock available, up 30.7%:
Property listings rising as demand slows.
PropTrack Economist and report author, Angus Moore, notes that a decline in buyer demand is behind the rise in listings:
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“Selling conditions have begun to temper from their very strong levels earlier in the year. Measures of buyer demand have declined off their high levels, it is taking longer to sell homes, and auction clearance rates have fallen. At the same time, buyers have had more properties to choose from in recent months. The wave of new supply coming to market over the first half of the year, particularly in Sydney, Melbourne, and Canberra, has lifted the stock available on market and helped make conditions a bit less competitive for buyers”.
Separate data from CoreLogic shows that listings have risen across the combined capitals (driven by Sydney and Melbourne), but are still lower across the combined regions:
Total advertised stock levels are now 4.2% higher across the capital cities than they were this time last year, as properties take longer to sell. However, total stock is slower to accumulate in regional Australia, with both new and total listings counts lower than a year ago.
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Meanwhile, CoreLogic shows that “initial sales estimates over the three months to July were -16.0% lower than the same quarter of the previous year”, indicating that buyer demand has fallen:
Property sales volumes falling.
In a similar vein, auction clearance rates have bombed into the low 50s, as buyers have chosen to remain on the sidelines:
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Auction clearance rates tanking.
As have new mortgage commitments, which are now falling in annual terms:
Annual mortgage growth turns negative.
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The above is clear evidence that “fear of overpaying” or FOOP has overtaken “fear of missing out” or FOMO. Home buyers are now remaining on the sidelines as they expect mortgage rates to rise and prices to fall.
The situation will continue so long as the RBA continues to hike interest rates.
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.
