A surge in for-sale listings tipped to dampen home price growth
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A surge in for-sale listings tipped to dampen home price growth

The forecast slowdown comes on the back of sharp increases in home values

By Shannon Molloy
Wed, Aug 30, 2023 10:10amGrey Clock 3 min

The number of new for-sale listings has been stubbornly sluggish for much of the year, but there are growing signs would-be vendors are finally feeling confident to go to market.

New analysis indicates this surge in supply is likely to put the brakes on a renewed boom in property prices being seen across much of the country.

According to data from research firm CoreLogic, national home values rose 2.9 percent in the three months to July – the highest quarterly movement since January.

Across the capital cities, values were up 0.8 percent last month – down slightly from a 1.2 percent lift seen in June.

Prices are rising fastest in Sydney, with a whopping 4.5 percent jump in the three months to July.

Prices rose 4.2 percent in Brisbane in the quarter, while Adelaide and Perth each recorded a 3.2 per cent increase. Values in Melbourne were up two per cent.

“Home values are down 3.4 percent annually, but declines are quickly subsiding from an eight per cent drop in the year to March,” Eliza Owen, head of residential research at CoreLogic, observed.

Data shows the number of new listings nationally hit 33,616 in the four weeks to 30 July, trending slightly higher through the month, which she noted is unusual for this time of year.

“The flow of new listings added to the market has been rising since mid-June, in contrast to the usual seasonal trend where new vendor activity would be trending lower through the colder months.”

With more homes hitting the market ahead of the traditionally busy spring selling season, Paul Ryan, economist at data house PropTrack, said price growth could dampen in the months ahead.

“There have been some tentative signs that sellers are responding to continued strong buyer demand and higher prices by bringing more listings to market,” Mr Ryan said.

PropTrack modelling shows a low level of new listings could be responsible for as much as a quarter of the price growth seen this year, and the impact of low supply can be felt within a few months.

“This analysis suggests that a stronger flow of listings could weigh on home price growth later this year as the market gears up for the spring selling season,” Mr Ryan said.

“And importantly, it shows the impact on prices is likely to be felt quite quickly after any new listings are brought to market – within one to two months.”

Mr Ryan said property markets have “displayed a remarkable turnaround in 2023”.

“Home prices fell persistently over 2022, down 4.1 percent from April to December, during the sharpest episode of interest rate increases ever implemented by the Reserve Bank,” he said.

“But 2023 has seen national home prices increase each month, up 2.8 percent so far this year, despite continued increases in interest rates.”

One major factor for the rapid turnaround in price movements is the low supply of new listings hitting the market, he said. Buyer demand has remained strong.

“The flow of new listings over the first half of 2023 was around 15 percent below the level seen over the same period in 2022, which represents a significant decrease.

“By contrast, the total number of homes on the market has mostly drifted upward as homes take longer to sell compared to the strong market conditions in 2021.”



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We reveal the No. 1 areas for price growth in each capital city

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Home values across Australia rose by a median 8 percent in FY24, delivering the equivalent of $59,000 in new capital growth to the two-thirds of the population that owns a home, according to CoreLogic data. Investors received total returns of 12.2 percent over the year, including capital gains and gross rental income.

Very tight supply and demand in most capital cities except Melbourne and Hobart was a significant driver of the capital growth, with the smaller and more affordable capital cities of Perth, Brisbane and Adelaide experiencing the most price appreciation over the year. A lack of properties for sale trumped the usual dampening effect of higher interest rates.

As usual, some areas outperformed their city’s median growth benchmark. Here are the top SA3 areas for capital growth in each capital city of Australia in FY24. SA3 areas are large suburbs, or districts incorporating clusters of suburbs, with more than 20,000 residents.

 

Sydney

Home values across Sydney rose by a median 6.3 percent in FY24. The No. 1 area for growth was Mount Druitt. Its median value rose by 13.96 percent to $859,939. Mount Druitt is located 33km west of the CBD. It incorporates the suburbs of Mount Druitt, Ropes Crossing, Whalan and Minchinbury. The Mount Druitt community is very multicultural with almost one in two residents born overseas. It is home to many young families, with the median age of residents being 33 compared to the NSW median of 39.

 

Melbourne

Home values across Melbourne rose by a median 1.3 percent in FY24. The top area for capital growth was Moreland-North with 4.71 percent growth. This took the district’s median home value to $746,488. Moreland-North includes the suburbs of Hadfield, Pascoe Vale and Glenroy. It’s a multicultural community with a particularly large contingent of residents with Italian ancestry. One or both parents of 66 percent of residents were born overseas, according to the 2021 Census.

 

Brisbane

Home values across Brisbane rose by a median 15.8 percent in FY24. The No. 1 area for growth was Springwood-Kingston in Logan City. Its median value swelled by 25.55 percent to $710,569. Springwood-Kingston is approximately 22km south of Brisbane CBD. It incorporates the suburbs of Springwood, Kingston, Rochedale South and Slacks Creek. It is a multicultural community with one or both parents of 55 percent of the residents born overseas, according to the 2021 Census. More than 15 percent of residents have Irish or Scottish ancestry.

 

Adelaide

Home values across Adelaide rose by a median 15.4 percent in FY24. The best area for capital growth was Playford in Playford City. Its median value soared by 19.94 percent to $530,991. Playford is approximately 40km north of Adelaide. It incorporates the suburbs of Elizabeth Downs, Elizabeth Grove, Angle Vale and Virginia. It is home to many young people under the age of 40. The median age of residents is 33 compared to the state median of 41.

 

Perth 

Home values across Perth rose by a median 23.6 percent in FY24. The No. 1 area for growth was Kwinana in Kwinana City. Its median value skyrocketed by 33.19 percent to $618,925. Kwinana is approximately 37km south of Perth CBD. It includes the suburbs of Leda, Medina, Casuarina and Mandogalup. Henderson Naval Base is located here and there is a significant community of servicemen and ex-servicemen living in the area. It is home to many young families, with the median age of residents being 33 compared to the state median of 38.

 

Canberra

Home values across the nation’s capital rose by a median 2.2 percent in FY24. The best area for capital growth was Weston Creek. Its median value rose by 5.24 percent to $937,740. Weston Creek is approximately 13km south-west of the CBD. It includes the suburbs of Weston Creek, Holder, Duffy, Fisher and Chapman. Approximately 43 percent of residents have a bachelor’s degree, which is on par with the ACT median but much higher than the national median of 26 percent. Household incomes are about 35 percent higher than the national median. Almost one in five residents work in government administration jobs.

 

Hobart

Home values across Hobart fell 0.1 percent in FY24. The top performing area for capital gains was Sorell-Dodges Ferry with 2.78 percent growth. This took the area’s median home value to $615,973. Sorell-Dodges Ferry is approximately 25km north-west of Hobart. It incorporates the suburbs of Richmond, Sorell, Dodges Ferry, Carlton and Primrose Sands. The area has a large community of baby boomers and retirees, with the median age of residents being 43 compared to the Australian median of 38.

 

Darwin

Home values across Darwin rose by a median 2.4 percent in FY24. The No. 1 area for growth was Litchfield. Its median value moved 3.21 higher to $672,003. Litchfield is about 37km south-east of Darwin and includes the suburbs of Humpty Doo, Acacia Hills and Southport.  It has a high proportion of middle-aged residents, with the median age being 39 compared to the territory median of 33. About 12 percent of residents are Indigenous Australians. The biggest industries are government administration and defence. Median household incomes are about 35 percent higher than the national median.

 

MOST POPULAR
11 ACRES ROAD, KELLYVILLE, NSW

This stylish family home combines a classic palette and finishes with a flexible floorplan

35 North Street Windsor

Just 55 minutes from Sydney, make this your creative getaway located in the majestic Hawkesbury region.

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