Those intent on scaling Sydney’s property ladder this year have been thrown a new obstacle – fewer properties are up for grabs and competition for listings is increasing.
New figures showed the usual December drop in listings that occurs each year as agents and property owners take holidays was substantially higher in December.
There were 28 per cent fewer homes available for sale over the month compared to November and 30 per cent fewer listings than in December 2018, according to the SQM Research figures.
Many of the properties that are available are old listings – more than half of the homes currently up for sale were first put on the market more than two months ago.
Only 20 per cent of the available properties were listed in the last 30 days.
SQM founder Louis Christopher said ongoing bushfires could compound the problem by discouraging many would-be sellers from listing.
“The recent devastating bushfires in NSW, Canberra and Victoria could also result in declines in property listings and impact property values in these regions in the coming months,” Mr Christopher said.
With buyer demand continuing to grow following last year’s series of interest rate cuts, the scant supply of properties for sale is likely to put further upward pressure on prices.
CoreLogic’s latest hedonic home value index revealed the city median home price – compiled from unit, house and townhouse sales data – increased 6.2 per cent over the past three months.
A typical property now costs about $840,000, but property pundits warned the median could hit the $900,000 mark later this year.
SQM is forecasting home price growth of about 10-14 per cent for the year, while Knight Frank research is also predicting double digit rises.
Mr Christopher said it may take some time for the price increases to encourage homeowners to sell.
“It takes a while for sellers to respond to (a booming) market and start listing,” he said, adding that most homeowners who wanted to upsize or downsize first needed to buy their next home, find an agent and prepare their home for a sale.
“Prices were falling for nearly two years so a lot of homeowners wanted to avoid selling at the bottom of the market … they aren’t selling yet, the current market boom is very new.”