Spring is heating up housing markets

More homes are being added to the real estate market as spring heats up and key cities cool following a prolonged housing boom and regulatory crackdown on investor lending.

But while listings are growing in Sydney, they’re not enough to cause a deluge or pull prices down dramatically, according to Brian White, chairman of Ray White.

“One of the best litmus tests of market change is a surge in listings,” White said. “We are seeing ­adequate listings, but no surge for spring.”

Charles Tarbey, chairman of Century 21 Australia, said there’s been a modest rise in stock, and this was expected to increase over the next few weeks. “The market [in Sydney] is starting to weaken. Auction clearance rates in Sydney were 70 per cent last weekend; they were 80 per cent a year ago,” he said.

The withdrawal of investors in the wake of a regulatory clampdown and higher mortgage rates, the slowdown in Chinese investment, and Sydney’s unaffordability after house price growth of 75% since 2012, have taken their toll on the Harbour City’s housing market.

House price growth has been flat in Sydney for the past three months, while Melbourne’s value lifted nearly 2%, according to CoreLogic. Price growth in Brisbane continues to be static, while Perth’s values fell 1.6% for the three months to the end of August.

In Sydney, the number of homes advertised for sale jumped nearly 5% in August compared with the previous month, and was up 12.4% compared with August 2016, according to SQM Research. In Melbourne, listings rose 3% for August, but fell 15.3% compared with 2016.   

“Looking ahead, we can expect to see a big boost to listings in September with the advent of the spring selling season,” SQM said in a research note.

The return of first-home buyers after the NSW and Victorian governments brought back first-home owner grants would bolster demand and prices, SQM said. “We’ve seen a strong monthly rise in listings in Sydney, Can­berra and Melbourne, with some buyers deciding to take profits on their properties with price gains being posted in all of those cities.”