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Inventory levels were tight at the beginning of 2021, with available supply threatening to fall short of accelerating buyer demand, new research has revealed.
With the housing market on a recovery trajectory, buyers who sat on their hands for the most part of 2020, for fear of loss, are now back in the market and eager to make up for lost time.
As a result, according to a recent CoreLogic report, existing housing supply has been impacted by a strong rate of absorption from rising home buyer activity, ultimately creating a seller’s market.
CoreLogic estimated that the number of national home sales over the past three months has surpassed last year’s figures by as much as 23.9 per cent.
Broken down, the volume of regional home sales is said to be 26.8 per cent higher than a year earlier, while capital city sales are up by 22.1 per cent.
Across capital city markets, the volume of capital city house sales exceeded the decade average by 11.8 per over the past six months, while the volume of capital city unit sales remained 8.1 per cent below the decade average.
Listing numbers
In contrast, the number of fresh listings added to the market nationally over the past four weeks ending 24 January was 3.3 per cent lower than last year and 13.3 per cent below the five-year average.
Nationally, total listing numbers, which include new listings plus re-listed properties, were 27.8 per cent lower than this time last year, tracking 29.3 per cent below the five-year average.
Melbourne and Perth stood to be the only capital cities bucking the trend, with new listings 20.8 per cent higher than a year ago in Melbourne and 2.2 per cent higher across Perth.
Meanwhile, Melbourne was also the only capital city to see higher listing numbers than last year, up by 7.7 per cent.
According to CoreLogic’s head of research, Tim Lawless: “Melbourne vendors may still be playing catch-up from the earlier lockdown period, while in Perth vendors seem to be relishing the best selling conditions seen in many years.”
Mr Lawless attributed the rise in listing numbers, particularly in Melbourne, to a rise in apartment advertisements at a time of low demand.
Seller’s market
According to the researcher, the ongoing imbalance between listing numbers and housing activity has created a seller’s market, with dwelling values continuing to rise across the board.
Further favouring vendors, the number of mortgage-related valuations were found to be 27 per cent higher than a year ago across CoreLogic’s Valex valuation platform.
Ultimately, despite expectations of a lift in new listing numbers, buyer demand continues to outpace new stock additions at present.
“If this trend persists, the rapid rate of absorption is likely to keep overall stock levels low, resulting in further upwards pressure on housing prices,” Mr Lawless concluded.
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