It comes as a new survey by realestate.com.au found market uncertainty is the top reason sellers have been sitting tight, as well as being unable to find another property to move into.
But with more clarity on the outlook for interest rates, REA Group director of economic research Cameron Kusher says sellers appear to be feeling more confident to take their homes to market.
“The feedback we've been getting from real estate agents this year is they've been encouraging people to bring properties to the market because prices have started to rise, sales volumes have been stronger,” Mr Kusher said.
“It seems that over the last month or two, there's been a bit of a circuit breaker and I wonder firstly, if that message has got through, but secondly, maybe because it's becoming more apparent interest rates may be at a peak, or very close to their peak.”
PropTrack data shows an unseasonably strong lift in new property listings in Sydney and Melbourne during July, with more new homes for sale than has been typical at this time of year over the past decade.
The mid-winter rush means the total number of properties listed for sale in Sydney, Melbourne, Canberra and Hobart was reasonably high in July, sitting at, or within 10%, of the average over the prior decade.
In other capitals, such as Perth, choice remained tighter where the total number of properties hit a fresh record low.
REA Group’s 2023 Property Seeker Survey – the largest property survey in Australia – found that while one million Australians currently intend on selling a home, only one in four will actually proceed with selling.
Market uncertainty was the leading reason respondents changed their mind about selling (36%) in the last 12 months, followed by no longer wanting to move (25%) and price expectations not being met (24%).
LJ Hooker's head of learning and development, Greg Allen, says interest rate uncertainty has played a major role in sellers’ decisions, impacting family budgets and decision making.
He says the belief interest rates are almost at their peak is helping people to plan ahead.
“I think they really now can take a good hard assessment of what the short term, medium term plans for their family is, and then say, ‘Okay, great, now that we've got all this information, this is what the next six months, 12 months, two years, five years looks like, and I can make a decision accordingly,” he said.
Buyer’s agent Kate Hill from Adviseable agrees interest rates have influenced vendors’ reluctance to list their property, as well as a lack of listings and the overall economy.
She says improved confidence that interest rates are near or at their peak, coupled with the traditional spring selling season looming, was now benefiting listings stock.
“If [the RBA] leaves interest rates on hold again in early September, then I think there will definitely be more listings coming on… because people will have that confidence that they can afford it and it's all settled down a bit,” she said.
Angus Raine, Raine & Horne Property Group executive chairman says while market uncertainty is the biggest factor impacting seller reluctance, home appraisals for the group were up 16% in July compared to a year ago.
“Other factors are the RBA leaving the rates on hold, which means the markets holding up, which also equates to vendors are more confident,” he said.
“I think property is now in the frontal lobe of both buyers and sellers, but it hasn't been in the last couple of years, that was sort of shelved.”
The improving sentiment is set to support the property market throughout the rest of 2023 and into 2024, according to PropTrack's latestProperty Market Outlook Report.
The report forecasts national home prices could rise between 2% to 5% in 2023, although Mr Kusher says it remains difficult to predict what lies beyond the spring selling season and into 2024.
“We know the spring selling season usually happens, it didn't happen really last year,” he said.
“And I guess the concern is, particularly in Sydney and Melbourne, if stock is getting to the market sooner, does it sort of peter out by October, November this year, and peter out earlier [than usual]?”
“I think there's probably a lot of pent up listings that haven't come to the market over the last 12 months or so, so I would expect that it's going to be a reasonably good spring for new listings.”
Looking ahead to next year, Mr Kusher said while it was difficult to forecast, momentum in the housing market and sales prices were factors to watch.
“With a lot of people coming off fixed rate mortgages of around 2%, [and moving] to 6%, how do people deal with that - if people have to sell their own properties, or sell investment properties off the back of those higher mortgage costs.”
Source: REA Group
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