Vendors lower asking prices amid flood of home listings

Sydney homebuyers suddenly have much more choice, with more houses on the market than at any time since 2009.

A massive storm front moves over Sydney. Picture: Ian H Gilchrist

Prospective Sydney homebuyers suddenly have much more choice, with more homes on the market than at any time since February 2009 and vendors lowering expectations, new figures show.

There are 30.4 per cent more homes on the market in the Harbour City than this time a year ago, with the number of listings rising 10.9 per cent over the month of August alone, according to SQM Research.

Although vendors traditionally list their homes at the start of the spring selling season, listing volumes in the NSW capital have now surpassed the peak recorded during the 2010-12 housing downturn, SQM said.

Listings rose during August in all capital cities, with Melbourne listings up 16.3 per cent in the month and 25.3 per cent from a year ago. Canberra has 10.7 per cent more homes on the market over the past month and 16.8 per cent more than this time last year.

The figures come as the housing market has been weakening for several months, hit by regulatory clamps on bank lending and buyer exhaustion.

As the supply of homes for sale rises, vendors have been cutting their asking prices, SQM found.

Asking prices for Sydney houses are down 2.1 per cent over the month to September 4, while units are down 0.4 per cent.

Melbourne asking prices have dipped 1.2 per cent for houses and 0.5 per cent for units over the month.

Even in relatively affordable Hobart where demand has been strong, asking prices fell 0.2 per cent for houses and 2.7 per cent for units.

SQM Research managing director Louis Christopher said the extra fifth weekend in August had boosted stock levels, although vendors were mindful of the softening market.

“Some homeowners are readying for a sale and want to list their homes sooner rather than later before prices fall any further, especially in Sydney,” Mr Christopher said.

“That is also true of Melbourne, where the property market has slowed, reflected in a 1.2 per cent drop in asking house prices over the month.