Favourable conditions for vendors selling now
The number of established properties for sale has remained persistently low since the start of April. Once restrictions prohibiting public auctions and open homes came into effect, vendors who didn’t have to sell simply chose not to. Over the last four weeks, however, early signs of vendor sentiment returning to the market have been evident as the number of established properties advertised as new listings has increased.
Describing market conditions nationally, Louis Christopher, Managing Director of SQM Research, said “it is not unusual for listings to decrease in June as it is the start of the colder winter months”.
“There was a solid increase in new listings. Indeed, we have more new listings on the market compared to this time last year.
“Listings that were coming up to 90 days dropped the most, indicating that some of the older stock had either been withdrawn or was selling during June. Overall, these numbers on their own would indicate fairly normal activity in the housing market. Of course, we know that conditions are far from normal. And this is illustrated in the fall in vendor asking prices for the month,” Mr Christopher said.
In Canberra, SQM Research found in June there was an extra 96 new listings which have been on the market for less than 30 days compared to the same time last year. Lack of choice, a persistent frustration for buyers, can be seen with 400 fewer properties advertised for sale compared to the same time last year.
Interestingly, the number of properties advertised for sale for 30-60 days and 60-90 days has decreased month-on-month, showing signs of strength in Canberra’s property market. There was a month-on-month increase of 14 properties advertised for between 90-180 days, demonstrating an unwillingness by some vendors to listen to market feedback until 180+ days on market, where there was a decrease in the number of listings.
Even though stock levels are showing early signs of recovery, a lack of quality stock has created favourable market conditions for those choosing to sell now. Domain reported auction clearance rates in Canberra of 85%-89% for three of the last four weeks. These exceptionally high levels of auction clearance demonstrate positive buyer sentiment and a willingness to buy now.
In the rental market, vacancy decreased during June and sits at 1.1% down from 1.3% this time last year. Asking rents for houses have decreased annually by 1% for houses, however, have increased by 2.2% for units.
Market conditions like these demonstrate the value of owning property in Canberra. Values have historically appreciated during good times; this is consistent, however at more moderate levels than other jurisdictions. This is the trade-off property owners make to receive exceptionally strong resilience to adverse market forces in times when they need it most.
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