Tight listings mean it's a seller's market
The combination of school holidays, travel plans and cooler weather typically makes winter one of the quieter periods for sales on the Australian property calendar, but lower-than-usual listings in June suggest that this winter is panning out to be even quieter than normal.
The number of new property listings across the country was 14.8% lower in June than at the same time in 2022 according to the latest PropTrack research using data from realestate.com.au, while total listings were more on par with last year at just 1% lower.
"We are just seeing fewer new properties hitting market," says PropTrack economist Angus Moore.
"Sydney and Melbourne are a good place to start because we have seen fewer new listings hitting the market throughout 2023. In June that was down a bit over 9% in Sydney and 6.5% in Melbourne, which is a bit smaller than we had been seeing in some recent months, but still down compared to a year ago."
Moore says that there are a couple of factors at play that are ensuring that supply in the market this winter is quite tight.
"One is just that last year was pretty busy. Late 2021 into early 2022 was a very busy time in property markets, and while that was starting to fade by the middle of the year, we were still seeing reasonable activity. So this year has ended up looking quiet by comparison.
"That said, it's not just that. Part of the story is the fact that prices were falling through 2022. Interest rates had risen very quickly, selling conditions had tempered off and we had seen clearance rates soften. It was taking a bit longer to sell homes.
"So we're probably seeing some vendors be a bit more hesitant now than they were in, say, spring 2021 or early 2022 when prices were rising very quickly and homes were selling very quickly."
Tighter market benefits sellers
The crux of the matter is that the relatively low number of homes up for sale at the moment - in many, but not all markets, it should be said - is putting sellers in the box seat.
"Certainly it's less competitive for sellers at the moment than it was. And demand on realestate.com.au is pretty healthy, auction clearance rates have been solid throughout autumn and into the winter which, again, indicates pretty solid buyer demand for homes," Moore says.
It's a trend that Marina Makhlin, principal at LJ Hooker Bondi Junction, is seeing play out first-hand in Sydney's eastern suburbs.
"I can only talk about our area, but supply is tight. It's probably the tightest we've ever seen it. I mean, winter is always lower in supply as opposed to a time like spring, but the difference is we've just been seeing so much buyer demand.
"We had a couple of properties launch last weekend and it was still school holidays and everyone seems to be overseas, but the numbers we had were like the middle of a spring campaign. We had a lot of buyers through and the commentary was 'I really want to buy something, but there's nothing to buy.'"
Given the lack of competition from other sellers and strong interest from buyers, Makhlin says that now could be the time for sellers sitting on the fence to make a move.
"I think at the moment just due to the lack of stock and the demand that we're getting at open homes, it is a great time to put your property on the market.
"It's all about supply and demand when it comes down to property. And at the moment, there isn't a lot of supply, but there's still a good amount of demand."
How can buyers give themselves an edge?
So with prospective home buyers facing stiff competition this winter in some markets, is there anything they can do to improve their chances of success?
"Buyers really need to be ready to make offers. They need to be financed, they need to know what a 66W is and they need to know what a lawyer needs to do to get their contracts in check. Wasting time in a tight market means you're going to miss out," Makhlin says.
"Don't be silly with your offers either. Speak to the agent to find out where that property is sitting and if the owner is willing to sell before auction.
"But the reality is a lot of properties, especially in tight market, are going off-market. So it may be an idea if you've been looking for a while to start looking at buyer's agents and having one represent you."
Alternatively, buyers who aren't in a rush can also try their luck in spring when, at least historically, there's generally more homes for sale.
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