House vendor drought may break this month

Welcome news for buyers battling fierce competition for housing stock, as sellers gear up to come back.

David and Emma McKeown and their children Amelie and Harriet outside their newly listed home in Kingsville, Melbourne. Picture: Arsineh Houspian

Early signs suggest residential property sellers are gearing up to come back to the market, which will be welcome news for buyers facing fierce competition.

The number of new properties being advertised remained at historic lows in most Australian regions in January, creating a hefty imbalance when compared to the intense demand from buyers.

Stock levels began the year ­almost 20 per cent lower than the same time in 2020, and 23.6 per cent below the five-year average, despite prices having risen 2.8 per cent nationally over the quarter to January, according to the latest CoreLogic figures.

CoreLogic research executive Tim Lawless said he was baffled by the lack of vendors, given rising confidence and the current conditions that would typically create a flurry of selling activity.

“I'm still a little bit surprised that we haven’t seen vendors becoming more active at a time when conditions seem extraordinarily strong,” Mr Lawless said.

But he said the signs were positive. Real estate agent activity on CoreLogic’s property database, RP Data, was up almost 7 per cent last month on the year prior, which suggests more sellers are gearing up to list.

“It’s looking to me like the number of new listings isn’t going to be rising enough to offset rising buyers demand, at least through February,” Mr Lawless said. “But we are expecting the numbers will rise next month and probably will continue to rise through March and April as well.”

Melbourne is the exception to the rule. Initially drawn to the trendy lifestyle and convenience of Kingsville in inner west Melbourne, last year’s lockdowns made David McKeown decide it was time to sell. He is among the slew of vendors who listed last month, more than 20 per cent more than in January 2020.

“We were hesitant to (sell),” the financial services chief financial officer said. “We wanted to move, but at the same time it needed to work financially. We didn’t want to sell in a low point or a distressed sales market.

“But there were some things giving us confidence. Last year, we saw the quick rebound in the Victorian economy and, more anecdotally, people really bounce back with positivity. That gave us some hope there might be a nice window here in the first quarter of 2021 for us to ride the positivity, but potentially get ahead of any other issues if they do play out later in the year.”

Local inner-west McGrath agent Daniel Stroscio said the only way to get a listing now is to take the time to educate vendors on current market conditions. Mr Stroscio is selling the Embperess Ave, Kingsville property.

The optimism of CoreLogic’s Mr Lawless was backed by The Agency’s chief executive Matt Lahood, who said Sydney and Melbourne’s listings last month almost doubled year-on-year, while west coast listings were up 25 per cent. The Agency’s network sales were also up 80 per cent on January last year.