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Sellers have procrastinated ahead of the traditional spring selling season, with analysts detailing the worst downturn in new listings in a decade - but signs of life are starting to appear.
However, green shoots in borrower activity are predicted to be the catalyst to lure sellers back, according to top residential mortgage broker Josh Bartlett. It comes as national auction clearance rates surged to a two-year high of 76.6 per cent.
“Buyers have come out of the woodwork, but there’s simply not the level of listings in the marketplace to accommodate the volume,” Mr Bartlett, managing director of Loan Market Bayside, said of the downturn in new listings on the market.
“It’s little surprise to see auction clearance rates bounce up above 70 per cent market in major capital cities. I’m averaging four to five client meetings a day at the moment, whereas at the start of the year, it would have been half that amount.”
Mr Bartlett reported a surge last month after the Australian Bureau of Statistics found a modest 1.3 per cent improvement in borrower activity nationwide from May to June.
Earlier this month, CoreLogic found Australia’s three major property markets recorded negative, year-on-year growth in new market listings. Melbourne declined by a minus 29.3 per cent, Sydney minus 35.5 per cent and minus 19.8 per cent in Brisbane.
However, CoreLogic more recently recorded that the national auction clearance rates had a surge of almost 80 per cent, the highest in two years.
Mr Bartlett said he equalled his highest volume of settlements in July, which has been a “traditionally quiet time of the year” in the past and shows buyers are ready.
“The green shoots of borrower activity should be what wakes sellers from their winter hibernation. There’s a short window of opportunity to capitalise on this competition.”
The federal election result, APRA’s easing of serviceability thresholds for borrowers and consecutive RBA cash rate cuts combined to stoke interests, Mr Bartlett said. He said first home buyers and middle-market owner-occupiers are seeking pre-approval.
“I’m seeing interest from borrowers across all price points, but there’s definitely a lot of activity in the entry-level FHB market and upgraders seeking to purchase in the $700,000–$800,000 market.”
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