Following years of frenetic activity in Australia’s hottest real estate markets, more signs are emerging that buyers might be ready to take a breather after CoreLogic reported stock levels are now outstripping demand in some cities.
Months of Supply figures are used to predict how long it should take to clear volumes of stock currently on the market and found across all capital cities, and analyst Cameron Kusher has found it is at its highest level for this time of year since 2012.
“It seems that the supply of stock for sale, relative to demand is increasing in Sydney, Melbourne and Brisbane,’’ he said. “In Perth and Darwin supply continues to dramatically outweigh demand but the balance is slowly improving.’’
By contrast, demand is still outweighing supply in Hobart and Canberra.
Mr Kusher said the rise to 4.4 months’ worth of residential properties currently being advertised for sale across the capitals, was primarily due to a slowing in the rate of property transactions rather than any spike in properties hitting the market.
He found the Months of Supply figure was at a five-year high in Sydney (3.0 months) Melbourne (4.2) and Brisbane (5.1), while Adelaide recorded a three-year high of 3.7 months. Perth’s figure of 6.3 months was an improvement, well down on the 8.7 recorded at the same time last year.
The weekly wrap from CoreLogic:
- A sharp fall in capital city auction volumes last week is set to be reversed with 2196 auctions scheduled in the coming week, led by Melbourne with 1001 and Sydney 877
- Nationally auction clearance rates remained fairly steady, down 1% to 73%
- A similar fall was recorded in Melbourne where 77.5% of the 792 auctions cleared
- Just 592 auctions were held in Sydney last week with the clearance rate dropping slightly to 73.8% from 74.3%
- Of the non-capital markets, the Gold Coast had the most number of auctions but just a 47.6% clearance rate, while Geelong property was in demand, with a 78.8 per cent clearance rate, followed by Wollongong with 73.1%.
(The months of supply calculation is a function of the trend number of property sales and the amount of properties listed for sale. For example, if there were 100 homes for sale and we see twenty sales each month, there would be five months of supply in the market. Or, in other words, it would take five months to absorb all the stock available for sale.)
