An explosion of new listings and a tighter lending environment have some agents quaking in their boots ahead of the first “super Saturday” of the spring selling season.
“Can we not talk about my property? Because I just don’t think its going to sell,” a nervous inner-Sydney agent said.
It’s not that the elegant, renovated four-bedroom home in inner Sydney is priced too high, at $1.4 million. It’s that buyers have too much to choose from.
“It’s just a really unlucky point in time,” the agent said.
More than 2800 homes will go to auction across the country today, the first major auction day or “super Saturday” of the season.
The mixed attitudes signal a boom market in transition, prompted by an explosion of listings that has diluted the pool.
Buyers are still hungry for homes, but more available homes coupled with a tighter loan market means a run of rampant price growth could be over.
“I’d say that stable prices could go through to the middle of next year before they start nudging up again,” Century 21 chairman Charles Tarbey said. Buyer fatigue also had a role in keeping auction attendance numbers down, Mr Tarbey said, as did a clampdown on lending to investors and other highly leveraged buyers.
UBS analysts agreed, saying the results of a consumer survey asking whether it was a “good time to buy a dwelling” had slumped to a five-year low, although respondents still considered property the “wisest place for saving”.
“These are still good conditions,” Mr Tarbey said. “A clearance rate of 73 per cent is still a bloody high conversion rate, and the only agents who deserve to be nervous are the ones that haven’t done their marketing.”
Almost 27,000 more homes have come to market in the past 28 days, according to Core Logic RP Data figures that show more than 92,000 homes on the market nationwide and an 18 per cent increase in Sydney alone.
Vendor Graeme D’Costa has high hopes for his three-bedroom terrace in Petersham, in Sydney’s inner west.
The mobile-tech company owner has seen several record-breaking sales in the area and is convinced he should follow suit. While he knows conditions could be moderating, he is unconcerned.
“There might be less people going to viewings, but that’s because the market is becoming savvier,” he said. “Sale prices are fine, but agents might have to work harder to get them.”
Brisbane-based agent Damon Warat agrees. He sold a two-bedroom apartment on Parkside Circuit in Hamilton, in Brisbane’s inner north, at auction yesterday morning for more than $980,000, bang on reserve, with two bidders.
“Buyers are becoming a lot more tactical in their negotiations,” the Ray White agent said. “They know that there’s been some steep prices and I think at this point they’re thinking twice about the best way to buy.”
Other agents are avoiding auctions altogether. Raine and Horne predicts more than a third of its properties will sell before auction today. “Whether this is the result of vendors becoming more realistic or is more indicative of buyers keen to snap up a home before auction is yet to be seen,” said chairman Angus Raine. “What is certain is that quality properties are still selling like hotcakes.”
Many experienced agents say such market conditions will sort the wheat from the chaff, following two years in which rampant demand has required little skill.
“A clearance rate higher than 80 per cent is just like taking orders, anyone can sell a home,” said Richardson & Wrench Marrickville agent Aris Dendrinos. “Give me a clearance rate of between 60 or 70 per cent and normal property conditions ... and a proper agent will still get your house sold.”
This article first appeared in The Australian Business Review