Rattled homeowners have been scuppering their plans to sell this winter as Sydney’s auction market continues to slump and falls in home prices accelerate.
Figures from PropTrack revealed another dour round of auction sales last week, with just 39 per cent of scheduled auctions actually delivering a sale.
It was a similar result to the 38.8 per cent success rate of auctions the week prior – a level similar to the global financial crisis in 2008, when prices dropped nearly 10 per cent annually.
Sydney prices have already dropped an average of 2.5 per cent since February, shaving nearly $31,000 off the typical sales price, and the lower prices appear to have sent shockwaves through sellers.
SQM Research figures indicated nearly 20 per cent fewer homeowners chose to list their properties over the past month.
10th December 2022. The Sunday Telegraph. Property. Greystanes, Sydney, NSW, Australia. Pics by Julian Andrews. Pictures from the auction of 6, Beechwood Avenue as auctioneer Michael Garofolo brings down the gavel on the sale.
There were 12,549 new listings over June, a drop from 15,641 new listings over May.
SQM Research director Louis Christopher noted there was some seasonality in the drop, but there was also a growing awareness among would-be sellers that Sydney was a buyer’s market.
He revealed total listings were higher than a year ago because of a glut of “old stock”, properties listed on the market for over six months without attracting a buyer.
“There’s evidence vendors are leaving the market,” Mr Christopher said.
“Some may be beginning to listen to the noise out there and rather than taking some desperate price they are taking their homes off the market.”
Generic auction picture Picture: Istock
Mr Christopher said it was likely the current downturn would extend into at least next year, but possibly longer.
“There is no sweetener on the horizon. No interest rate cut, no likely turnaround from the government on its (negative gearing and capital gains tax) policies.”
REA Group economist Luc Redman said the Sydney homes that were selling may have been because the vendors were accepting reality.
“Sellers (are) re-evaluating their price expectations and potentially, meeting buyers where they are at,” Mr Redman said.
Mr Redman said clearance rates have been on a downward trajectory since the start of the year, primarily driven by interest rate rises, cost of living pressure, and budget tax changes.
New listings have been falling. Picture: Damian Shaw
“Winter is usually a slower period for the property market and may mean current clearance rates will remain (low) … until seller expectations change or the market shifts,” he said.
Auctioneer Tom Panos said recent auction clearance results reveal the market is “still struggling and its trying to find a footing”.
Mr Panos said buyers were “in command”, sellers trying to find the best way to sell while auction volumes were falling.
“Fewer homes are coming to the market and even fewer are selling,” he said.
“We’re not seeing a market in free fall, but we’re certainly seeing one that is trying to find a bottom.”
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