Property sales to weaken as rate hikes bite

According to the research group, new listings and auctions are still both set to rise in the coming weeks, despite the latter’s particularly slow start to the season.

The 28 days leading into 4 September saw 35,213 new listings advertised nationwide, a figure that is higher than the equivalent period from 2019–21. Moreover, CoreLogic also detailed how comparative market analysis (CMA) activity rose 8.2 per cent in the final seven days of August, which indicates the seasonal lift in new listings is imminent.

Such a rise is expected to have knock-on effects on the auction market — which tends to report activity increases from September through December — with CoreLogic expecting auction volumes to follow a more “normalised” trend seen in the five years pre-COVID, as opposed to that seen during 2021.

It’s important to note that the seasonal uplift in new listings will vary from region to region. In the five years prior to the pandemic, the national change in new listing campaigns between winter and spring rose 19.6 per cent.

However, in cooler climates, this seasonal effect on listings is usually larger — as evidenced by the 42.4 per cent rise seen in Canberra, the 33.7 per cent growth seen in Adelaide and the 31.6 per cent jump in Hobart.

This trend remains true for lifestyle areas, like the Mornington Peninsula and the Yass Valley, which saw an average rise in seasonal listings of 49.2 per cent and 67 per cent, respectively, between 2015 and 2019.

However, this year’s selling season is unlikely to be comparable to the levels recorded in 2021 — when there were an estimated 154,294 new listings added to the market throughout spring, approximately 10,000 higher than the decade average. Auction volumes also reached record-breaking levels at the end of last year.

These unparalleled activity levels are likely to have occurred due to the difficulty of selling during the extended lockdown periods that gripped Sydney and Melbourne predominately between June and October, which forced sellers into playing “catch-up”.

Entering spring 2022, CoreLogic explained that buyer appetite has declined against a backdrop of higher interest rates, inflated time on market and greater vendor discounts.

Despite this, there are still certain demographics that are more likely to sell — notably long-term owner-occupiers, as they are the most likely to have nominal gains, even with the market downturn fluctuating prices downward.

CoreLogic did warn that despite a flock of activity occurring in spring, that doesn’t necessarily make it a seller’s market. Properties are taking longer to sell — up to 33 days in the three weeks preceding August — with discounting becoming larger and more prevalent, all of which means vendors need to be realistic about their price expectations.