The proportion of property owners who consider it a good time to sell has increased from the lows seen at the start of the year, as buyer demand heats up for spring.
This finding comes from realestate.com.au’s Residential Audience Pulse – a longitudinal survey designed to understand the changing sentiment of those in the property market, whether looking to rent, buy, sell, or hold.
Among the property owners surveyed, sentiment towards the market has seen dramatic swings over the past few years, particularly when it comes to conditions for selling.
Sentiment peaked in October 2021, when 50% of property owners judged it to be a good time to sell – double the 25% who considered it a bad time.
But over the 18 months following, sentiment gradually declined, dropping significantly mid-last year with the onset of the Reserve Bank’s aggressive rate hiking cycle.
By December last year, sentiment had plummeted, with just 19% considering it a good time to sell, a figure that held steady over the first half of the year.
This negative sentiment was reflected in a substantial drop in the number of properties being listed for sale. Over the first six months of 2023, there were around 15% fewer properties listed for sale compared to the same period last year.
But now, we are seeing a shift. PropTrack’s latest Listing Report shows that the total number of homes hitting the market saw a significant come back in August.
This rise in the number of properties being listed for sale is consistent with the recovery in sentiment seen over this time. Between March and July, the proportion of property owners who considered it a good time to sell saw a statistically significant rise from 19% to 24%.
What’s more, the share who consider it a bad time to sell recorded an even greater change, falling from 51% to 41% since the start of the year. 35% were still unsure.
Based on what we are seeing with listings volumes, this sentiment likely saw further recovery over August and contributed to the rise in properties for sale.
Understanding what’s driving the improvement in selling sentiment comes down to perceptions around buyer demand.
Back in March, the number one reason property owners were selling was that it suited their personal circumstances, cited by one third of respondents. Just 15% were selling because they perceived buyer demand to be high.
These drivers have now reversed. The perception that buyer demand is currently high was the number one reason property owners considered it a good time to sell in July, cited by 28% of respondents.
This perception marries up with lead indicators of demand seen on realestate.com.au.
In a sign that should give more confidence to sellers, the rise in properties being listed for sale has coincided with a rise in buyer demand.
This has resulted in the average number of enquiries a property listed for sale receives holding steady over August, despite the rise in overall listings. What’s more, the average number of enquiries per listings was 16% higher in August compared to 12 months earlier.
Capital city areas have seen the strongest recovery in demand, with enquiries per listing rising by 27% over the 12 months to August.
Property prices have risen every month so far this year, despite significant increases to interest rates, and the dearth of properties for sale relative to buyer demand has been a key reason why.
The fact that buyer demand is so far picking up in line with the supply of properties for sale is good news for sellers and is helping to support resilience in prices.