A dip in home values across some key capital city suburbs and a rise consumer confidence is bringing seller and buyers back into the residential real estate market
9 June 2020 | Staff Writers (Image: Alexander Andrews)
Home sellers are surging back into housing markets reflecting rising consumer confidence as coronavirus restrictions continue to ease.
The latest National Newly Listed Homes Index exclusive to My Housing Market reveals a steep increase in seller activity over the past week.
Although new listings predictably eased over the Queen’s Birthday long weekend holiday, the peak of 86.55 recorded on Friday was the highest result since April 1.
Says economist Dr Andrew Wilson, of My Housing Market, “Numbers are quite small because we’ve only been able to have open auctions over the past couple of weekends. It will be a while until we see a substantial pick of activity yet the numbers are still quite positive.”
“As price pressure increase we are evolving into a buyers’ market.”
Wilson points out that two previous major economic downturns, recession in 1991 and the global financial crisis in 2008, home prices performed well. That might not be the case this time around.
“During the GFC we saw mortgage rates drop from 10 percent to 5 percent,” he says. “That helped the market to keep ticking over. But with an official rate of 0.25% there’s no room to stimulate buyer activity on the interest rate front.”
Soft auction results over long weekend
Last week, 694 capital city homes were scheduled for auction, with preliminary results returning a 59.8 percent clearance rate. The lower volume of auctions came as most states and territories welcome the Queen’s Birthday public holiday on Monday.
The previous week saw 856 homes scheduled for auction and a final clearance rate of 61.3 per cent, the third week in a row where the final clearance rate held above 60 per cent. One year ago, there were 805 homes taken to auction and a 48.3 per cent clearance rate was recorded.