Massive sign that property market is finally slowing down

It’s the first concrete sign that the market is turning sluggish, with sellers missing out massively because of this new trend.

The first sign that Sydney’s turbocharged housing market is slowing down has emerged.

More than one in ten homes in the NSW capital are selling for less than they were initially priced at, according to Domain data released on Monday.

An estimated 10 per cent of dwellings are having to sell at a substantially discounted price because of the phenomenon.

That number isn’t much better in Melbourne, with nine per cent of properties having to sell for less to entice buyers.

The trend is reportedly because the real estate industry is saturated, with too many people wanting to sell and not enough buyers to go around.

It could come as a welcome reprieve for aspiring first home buyers who have been largely priced out of the market after property values rose by 25 per cent last year.

Domain’s head of research and economics, Dr Nicola Powell, told news.com.au: “Homes are now coming to the market quicker than they’ve been able to sell.”

This Parramatta home had to massively reduce its price.

The data found that as of last month, 10.5 per cent of homes in Sydney were lowering their prices.

At the peak of last year’s property boom in July, that number was half as much, with only 5.9 per cent of homes having to discount their value to be snapped up.

Now, when a Sydney house reduces its asking price, it goes down by an average of five per cent once, Domain reported.

Meanwhile in Melbourne, the number of discounted properties stands at nine per cent, with a price reduction of 4.7 per cent on average.

In September last year, Melbourne’s discount rate was just 3.5 per cent.

In bad news for sellers but great news for buyers, one Sydney home relisted $100,000 cheaper than its original asking price.

Inside the Parramatta home that slashed its price by a whopping $100,000.

A Parramatta duplex has been on the market for months but they dropped its $750,000 price tag to between $650,000 and $700,000 in a major blow for the sellers. There is currently no price visible online and interested parties have been advised to contact the selling agent.

A Wolli Creek home shaved off $35,000 from its price, after sales didn’t go as planned.

The $780,000 asking price was bumped down to $745,000.

Another Sydney home in the inner west suburb of Ashfield had a price guide of $700,000 to $770,000 heading into the auction.

But the highest bid came in at $700,000, causing them to advertise with a new price tag of $738,000, $32,000 less.

The Wolli Creek home.

The Ashfield home.

Dr Powell warned that buyers were getting choosier, which was leading to a housing slowdown.

“Buyers are getting more careful of paying too much [for a property] rather than paying out of fear of missing out,” she said.

“We’ve gone into 2022 with much better buying conditions.”

To top that off, there are too many homes on offer, according to Dr Powell.

“We’re seeing demand ease and views per listing have been pulled back, whereas demand was outpacing supply last year.”

Homeowners most likely saw now as a good time to sell their properties because “they’re timing it when prices are at their peak and interest rates haven’t gone up,” she explained.

However, this had the added side effect of flooding the market with housing stock.

With interest rates expected to rise in the next several months, Dr Powell expects to see more houses forced to re-list at a cheaper rate.

“We’re likely to see it [the number of discounted houses] track higher as we see the market slow down more, I do think we’ll probably see it proportionally rise,” she added.