Spring 2018 property market outlook
It’s little surprise that Sydneysiders have long considered spring a great time to sell property. The weather impacts home sales in all sorts of ways and spring is a time of year when the sun is shining, the grass is green and the cold winter months have been left behind.
In 2017, spring sales were more muted than usual due to a range of factors including regulatory changes, a conservative consumer outlook and less demand for houses.
Where are we now?
The slowdown has continued. After a decade of rising house prices, the Australian property market, especially in Sydney and Melbourne, is in a well-publicised cooling cycle that’s being reflected in recent auction clearance rate data.
According to CoreLogic, auction volumes from the start of August saw 1,536 homes go under the hammer across all capital cities combined, returning a final auction clearance rate of 55.6 per cent.
That’s down from 57.0 per cent across 1,257 auctions the previous week and over 10 per cent from the same week last year when 1,987 homes went to auction for a clearance rate of 68.7 per cent.
Sydney is seeing the same downward trend. The harbour city’s final auction clearance rate came in at 52.4 per cent across 469 auctions at the start of August, down from 55.2 per cent across 407 auctions over the previous week, CoreLogic reported. Over the same week in 2017, 714 homes went to auction in Sydney returning a clearance rate of 65.4 per cent
What do the experts predict for spring?
According to experts, the trend towards a buyers’ market is set to continue into spring, potentially making the three months to December the best conditions for house hunters in almost 30 years.
“It’s going to be a very good spring for home buyers,” SQM Research analyst Louis Christopher recently told property site realestate.com.au, adding that the very low auction clearance rates in Sydney and a spring bounce in listings would likely “mean the clearance rate will go even lower”.
In a further boost for prospective home buyers, the Real Estate Institute of Australia (REIA) forecasts that the Reserve Bank will keep interest rates on hold at 1.5 per cent for the rest of the year.
“For home buyers the latest inflation data together with a cooling in the housing market would suggest that the RBA will hold official interest rates stable for 2018,” REIA President Malcolm Gunning said recently.