Spring selling season kicks off with a bang
PropTrack data shows the number of auctions scheduled is up 13% compared to the first week of spring in 2022, as rising property prices give sellers more confidence to bring their homes to market.
Melbourne tops the list with 961 homes scheduled for auction this week, a 24% rise year-on-year, while Sydney is up 23% with 785 homes set to go under the hammer.
PropTrack economist Anne Flaherty says it follows unseasonably strong winter momentum, with more homes hitting the market and an "unusually high" number of auctions.
“One of the reasons we're seeing such a busy start to spring is that there's probably a whole cohort of sellers who had held off selling their properties over the first half of this year, or the back half of last year,” she said.
“We saw a very quiet first six months of 2023 as a lot of people were hesitant to sell.
“We know from research that the proportion of homeowners that considered it a bad time to sell a property was really high and now we've seen an improvement in selling sentiment.”
The spring selling season has kicked off with a bang as auction numbers jump year-on-year. Picture: Getty
It comes as the latest PropTrack Home Price Index rose for an eighth straight month in August, with home values rising 0.28% nationally.
Confidence up amid signs interest rates have peaked
According to realestate.com.au’s latest Property Seeker survey - the largest property survey in Australia - which was conducted in May, two in three buyers said rising interest rates had significantly or moderately impacted their property decisions.
It found 22% had held off plans to buy due to rising interest rates, while around 40% had been forced to look in other locations, or compromise on the size or type of home they're looking for.
Ms Flaherty said uncertainty around interest rates led many people to delay buying or selling, but two months of rates being held steady had restored market confidence.
“We are seeing one of the busiest starts to spring that we've seen in many years. There are a lot of homes set to be auctioned this coming weekend and indeed over the next few weeks as well,” she said.
“Last year we were grappling with property prices falling, interest rates were still rising very rapidly, uncertainty was incredibly high.
“We will see the total number of homes auctioned higher this spring compared to last spring.”
More homes being put up for auction as a selling method was also a sign of confidence in the market, Ms Flaherty says.
Buyers 'ready to pounce'
A healthy sense of optimism and anticipation was ahead for the spring selling season, according to buyers advocate and propertybuyer.com.au chief executive officer Rich Harvey.
“We've had 12 interest rate rises, which has really held the market back,” he said.
“I think we are at the peak of the interest rate cycle so I think the buyers have been sitting on the sidelines and they're ready to pounce,” he said.
Interest rates have remained on hold since June. Picture: Getty
The good news for buyers, Mr Harvey says, is there will be more choice in the market.
“When there's more supply - which is what's coming - that's going to have slightly less price pressure,” he said.
“I mean, I think there's still going to be a continued upward pressure on prices, but not as frenetic price increases as we've seen in previous years - so that's how I see the market playing out in spring.”
Buyers finally have more choice
Ms Flaherty says the spring selling season is set to benefit buyers on the hunt for a home.
“Buyers have had to deal with not that much choice over the first half of this year,” she said.
“So the fact that we're suddenly seeing a lot more properties hitting the market, this is going to be great news for buyers as they have more choice,” she said.
“The fact that there are more properties out there might help to alleviate some of that competition that we were seeing when there were fewer properties for sale.”
Despite an expected increase in listings over spring, Belle Property head of growth Nick Boyd says he doesn't believe it will be enough, with new homes quickly absorbed by the market.
“The amount of buyers coming through properties from right around the country that I'm speaking to, [for example] the shortage of stock on the market over in [Western Australia] is extraordinary,” he said.
“So that's where I do say, is it going to outdo [spring] ‘22 in terms of volume of properties? I don't know.
“But I do believe the pricing is going to be stronger than what people were anticipating.”
Originally published at: https://www.realestate.com.au/news/spring-selling-season-kicks-off-with-a-bang/