Sydney’s New Home Listings Drop | Kanebridge News
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Sydney’s New Home Listings Drop

The NSW capital’s market has seen a rapid decline due to COVID.

By Terry Christodoulou
Wed, Aug 4, 2021 1:41pmGrey Clock < 1 min

The number of new home listings has dropped by nearly 20% in July. The sharp dip comes as vendors put plans to sell on hold amid surging COVID case numbers.

The data, from SQM Research, shows home listings under 30 days have plummeted the most in areas where harder restrictions were imposed. However, sellers in other parts of the city have also retreated from the market.

Parramatta saw the total listings fall 33.4%, Liverpool 30.7%, Canterbury Bankstown 29% and 21.8% in western Sydney.

By comparison, areas such as the upper north shore saw listings down 26%, eastern suburbs 23% and inner west 22.6%.

Other state capitals across Australia saw mixed results with Brisbane – which went into lockdown last Saturday – growing 2.6% over the month.

Elsewhere, Darwin posted a 41.4% drop in new listings while Adelaide fell 7.2% and Perth 4.2%.

More positively, Melbourne saw new listings up 9.3% alongside Canberra’s 11.4% rise and a 27.6% uptick in Hobart.

Year to date, total listings have declined 23.6% nationwide – Hobart the most affected with 36.7%.

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House values continued to fall last month, but the pace of decline has slowed, CoreLogic reports.

In signs that the RBA’s aggressive approach to monetary policy is making an impact, CoreLogic’s Home Value Index reveals national dwelling values fell -1.0 percent in November, marking the smallest monthly decline since June.

The drop represents a -7.0 percent decline – or about $53,400 –  since the peak value recorded in April 2022. Research director at CoreLogic, Tim Lawless, said the Sydney and Melbourne markets are leading the way, with the capital cities experiencing the most significant falls. But it’s not all bad news for homeowners.

“Three months ago, Sydney housing values were falling at the monthly rate of -2.3 percent,” he said. “That has now reduced by a full percentage point to a decline of -1.3 percent in November.  In July, Melbourne home values were down -1.5 percent over the month, with the monthly decline almost halving last month to -0.8%.”

The rate of decline has also slowed in the smaller capitals, he said.  

“Potentially we are seeing the initial uncertainty around buying in a higher interest rate environment wearing off, while persistently low advertised stock levels have likely contributed to this trend towards smaller value falls,” Mr Lawless said. “However, it’s fair to say housing risk remains skewed to the downside while interest rates are still rising and household balance sheets become more thinly stretched.” 

The RBA has raised the cash rate from 0.10 in April  to 2.85 in November. The board is due to meet again next week, with most experts still predicting a further increase in the cash rate of 25 basis points despite the fall in house values.

Mr Lawless said if interest rates continue to increase, there is potential for declines to ‘reaccelerate’.

“Next year will be a particular test of serviceability and housing market stability, as the record-low fixed rate terms secured in 2021 start to expire,” Mr Lawless said.

Statistics released by the Australian Bureau of Statistics this week also reveal a slowdown in the rate of inflation last month, as higher mortgage repayments and cost of living pressures bite into household budgets.

However, ABS data reveals ongoing labour shortages and high levels of construction continues to fuel higher prices for new housing, although the rate of price growth eased in September and October. 

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