‘Way more people trying to sell’: Where Melbourne home owners are selling now

An increase in property listings paired with softening home values across Melbourne could mean better market conditions for buyers this spring.

Melbourne’s inner suburbs had a 74.2 per cent increase in new listings in the last week of August against the five-year average, data from CoreLogic has revealed.

Listings rose in Melbourne’s west and north-east, where the number of newly listed homes has increased by 58.9 per cent and 58.8 per cent, respectively, in the same time period.

CoreLogic head of Australian research Eliza Owen said an oversupply of stock in the lead up to the spring selling season had created more opportunities for buyers.

“You’ve got a stronger flow of new listings coming to the market than what we’ve seen historically and most of those listings volumes have continued to rise over the past four weeks, with additional stock levels flowing through...the exception is Melbourne’s west,” Owen said.

Owen noted that the number of new listings in Melbourne’s west declined in the past four weeks, with an overhang of lingering stock deterring some vendors from listing their homes.

“There are way more people trying to sell right now than there are people trying to buy property, so that’s leading to this downward pressure on prices and that’s not an environment that you want to try and sell your property in,” she said.

Owen said properties in Melbourne’s inner-east, which recorded a 1.6 per cent decline in total listings, were more tightly held compared to the rest of the market in part because home owners may not be battling the kind of mortgage stress being felt in other parts of the city.

Westpac senior economist Matthew Hassan said an overhang of housing stock combined with a decline in property values over the past three months had created ideal conditions for buyers this spring.

“It’s pretty much a clear indication that it should be a buyers’ market coming to spring...and you’ll tend to see prices soften to meet that demand,” Hassan said.

In Melbourne’s inner-east and inner-south, home values declined 2.6 per cent and 1.7 per cent in the three months to August.

Hassan said buyers could afford to be selective this spring, adding that speculation over interest rates had not deterred as many buyers as expected.

“The vast majority [of buyers] expect prices to rise over the next year, so I don’t think there’s a ‘hold off and wait for better prices mentality’ on the buyer side. It’s more about, perhaps using some of that buyer power be a little bit picky,” he said.

Prospective home buyers Carley Swan and Lee Coats said they had noticed an increase in listings when researching potential properties.

Carley Swan and Lee Coats are selling their home this Spring.Credit: Justin McManus

The couple, who both work in marketing, plan to put their Pascoe Vale home on the market in September and buy a larger home in Melbourne’s outer east.

“I’ve seen a steady increase in the types of properties that we’ve been searching for,” Coats said. “We’re very specific about number of bedrooms, and we want a pool, that kind of stuff, and there’s definitely been options.”

“Some of (the homes we’ve been looking at) have actually gone for less than we expected, which is certainly a good sign from our perspective,” Swan added.

Swan and Coats said their property search gave them a better understanding about their sale plans.

“I think we’ll sell (our home) but one of the key things to consider when the market is picking up is there’s much more choice for buyers,” Coats said.

Their real estate agent, Ryan Currie, of Nelson Alexander Flemington, said that while he had seen an increase in property listings in the lead up to spring, homes priced fairly were selling well.

He also expects auction activity to pick up but warned sellers might need to lower their expectations.

“The market’s gone up, it’s come down, it’s now balanced,” he said. “If you’ve got that mindset or idea in your head that a property will hit your reserve, and then – like it was possibly doing two years ago – go $100,000 over, I don’t [think] that’s the market we’re in right now.”

Ray White Sunshine director Marcus Fregonese said investors and recent buyers putting their homes up for sale were making up a large portion of listings in Melbourne’s west.

“We’re certainly seeing some vendors, first home owners, who purchased over the last few years that are really starting to struggle with interest rates and cost of living pressures,” he said.

“They’re either leasing their properties out and going back to live with mum and dad, or selling up and then going to rent for a few years. We’re definitely seeing a lot of that, but we’re also seeing investors exiting the market.”