Huge change to property market this month

Homeowners are becoming more confident about putting their properties on the market, with the latest figures showing 40 per cent more homes available than there were 12 months ago.

The latest PropTrack listings report revealed the Aussie property market saw the strongest new listings for the month of April since 2021.

New listings were up 40.4 per cent year-on-year across all capital cities.

PropTrack economic research director Cameron Kusher said while there are new listings higher in each capital city, Sydney and Melbourne continued to be the strongest markets.

“If we look in Sydney and Melbourne, the number of listings has been higher year-on-year every single month since July last year,” Mr Kusher said.

“Although home prices have remained buoyant in early 2024, the surge in new listings has seen the total number of properties advertised for sale mount, particularly in Sydney, Melbourne and Canberra.

“Despite the increase in properties available for sale, other indicators signal that buyer demand remains strong such as median time on market declining and overall enquiries rising compared to a year ago.”

New listings for April year-on-year:

• Sydney 44.9 per cent

• Melbourne 52.7 per cent

• Brisbane 34.4 per cent

• Adelaide 26.6 per cent

• Perth 23.5 per cent

• Hobart 11.1 per cent

• Darwin 2.7 per cent

• Canberra 49.1 per cent

Mr Kusher said the spike in new listings did not come as a complete surprise, as property owners reflected on how interest rates were impacting their budgeting and ongoing cost of living pressures.

“I think a lot of that was the number of new listings coming to market previous to that were very low, when interest rates were changing every month in 2022 and then changing regularly in 2023,” Mr Kusher said.

“I think people were realising it wasn’t an ideal situation to sell at that time.

“Now that interest rates have been more stable, while we still have had a couple of increases, but (they’ve been) more stable for almost a year, that’s given people more confidence to put their properties on the market.

“The next few months will be quite telling because obviously a lot of people that own homes or are looking to buy homes are expecting interest rate cuts later this year but it’s looking more likely interest rates will come down in the first half of next year.

“It’s going to be quite interesting to see how the market reacts to those expectations having been pushed out so far.”

But Mr Kusher said there was a “combination of things” that had encouraged people to look at selling their properties.

“Certainly, there’s a cost of living pressure that is forcing some people to sell, but equally, I think there’s other factors,” he said.

“Property prices have increased a lot in a short period of time.

“Some people are looking at the level of equity they have in their property and using that to upgrade in the market.

“I think also there’s other factors that people have been delaying selling and they’re in a home now that no longer fits them.

“It’s very expensive to do a major renovation to a property because material and trade costs have gone up so much, so that’s encouraging people to move.”

However, Mr Kusher warned the latest year-on-year figures could be “exacerbated” around March and April depending on when Easter fell.

Sydney, Melbourne, Hobart and Canberra also saw an increase in total listings for sale in April 2024 compared to a year earlier with 16.1 per cent, 21.4 per cent, 1.1 per cent and 29.7 per cent respectively.

But things haven’t been as strong in Brisbane, Adelaide, Perth and Darwin compared to 12 months ago.

Compared to a year ago, total listings were down in those capital cities 6.3 per cent, 9.4 per cent, 23.2 per cent and 0.5 per cent respectively.

Mr Kusher said those capital cities had seen fewer new builds reducing the amount of choice available on the market.

“There’s just a lot more choice for someone looking to buy in Sydney and Melbourne than what there has been as well,” he said.

Meanwhile, Mr Kusher said as the property market continued to strengthen, the rental market remained strained due to a lack of rental stock available.

“In Sydney and Melbourne, demand (for rentals) has dropped a little bit from where it was 12 months ago,” Mr Kusher said.

“In most capital cities you’ve still got very low stock and rental competition.

“We know that the rate of people migrating to Australia is starting to slow but there’s not a lot being built in these cities for the rental market so there’s not a meaningful increase in supply coming.

“We’re getting to the point where people are going to challenge to have the capacity to pay the prices people are seeking.

“What that means is people are going to move into smaller properties, move to less desirable locations ore move into share housing to save on rental accommodation.

“I think the rental market is going to remain tight for probably several years but we probably won’t see rents increasing as rapidly as we have because people’s wages are not keeping up with rental growth.”