- BRW Lists
Published 09 January 2013 16:41, Updated 14 January 2013 07:10
The number of homes for sale in Sydney plunged by a record amount in December, suggesting a surge in buying activity leading up to Christmas.
At the end of December there were 21.7 per cent fewer homes advertised for sale online in Sydney, according to figures by SQM Research, which was the greatest monthly drop since SQM began measuring listings in 2008.
While the largest decline was in Sydney, most other capitals also saw a substantial drop.
“Stock levels fall for two reasons – either sellers withdrawing their properties from online advertising, and stock being sold,” says SQM Research managing director Louis Christopher. “Seasonally you do tend to get a drop in listings over Christmas but it’s dropped more than the seasonal change. Something else has happened in the market and I would suggest the stock has been sold.”
A drop in the number of homes for sale can indicate increasing market activity and can also lead to rising prices as demand begins to outbalance supply. It is a more timely, but less reliable market measurement than statistics on sales volumes and rising house prices, which tend to lag by several months.
The SQM numbers found listings declined by 15.2 per cent in Canberra and 10.4 per cent in Melbourne – also substantial drops. Nationally there was a 6 per cent decline.
“There are now less listings on the market than we had this time last year,” Christopher says. “That means less choice for buyers, and that’s because there are more buyers out there. We note housing finance has been picking up. It should still be noted overall listings are still somewhat elevated, but not in Sydney.
“You could arguably still call it a buyer’s market but things are changing, no question about that.”
Century21 Australia chairman Charles Tarbey said the figures should be viewed with caution because people generally don’t spend on online advertising over the Christmas period. But he agreed with SQM’s view that the drop was larger than normal and indicated rising sales volumes.
“You will see the results coming through in transactions,” Tarbey says. “We saw on a daily basis a significant increase in completed transactions leading all the way up to Christmas.
“It is a national phenomenon, except in capital cities like Melbourne and Adelaide that already had a bit more stock on the market than normal. I think you will now see a surge of properties coming back up for sale. There is a lot of confidence from sellers out there that market sentiment has changed for the better.”
Home values declined nationally by 0.4 per cent over 2012 according to figures by RP Data-Rismark, suggesting generally flat market conditions.