Sydney and Melbourne were both “extreme seller’s market” as of the end of July, according to an index created by the Commonwealth Bank and CoreLogic RP Data.
Housing affordability declined in both cities, which just the year before were graded merely as a “seller’s market”.
The index is based on the ratio of properties for sale compared with the number of housing loans being committed to by Commonwealth Bank, Australia’s largest mortgage lender.
A buyer’s market exists when the number of listings outweighs the number of mortgage commitments, while a seller’s market exists when demand outweighs supply.
Over the past year, Adelaide and Canberra both made the move from a balanced market to a seller’s market.
Brisbane changed from a buyer’s market to a seller’s market, while Perth remained in balance.
Hobart and Darwin remained unchanged as buyer’s markets.
CoreLogic RP Data senior analyst Cameron Kusher said that while Sydney and Melbourne are booming, the real estate market is more balanced throughout the rest of Australia.
“Regional areas continue to offer the best opportunities for would-be homeowners, while sellers are still benefiting from increased demand in metropolitan areas,” he said.