It's now taking significantly longer to sell a home in Australia

Mark Wilson/Getty Images
  • There haven’t been this many homes listed for sale across Australia since 2012.
  • It’s now taking 53 days for the average capital city to sell via private treaty, up from 42 days a year ago.
  • CoreLogic says it’s now a “buyers” markets meaning “vendors will need to be reasonable with their pricing expectations”.

There’s a flood of properties for sale across Australia, the most since 2012.

According to CoreLogic, total capital city listings have risen by 10.2% over the past year to 117,759, largely reflecting large increases of close to 20% in both Sydney and Melbourne, Australia’s largest cities.

Tim Lawless, Head of Research at CoreLogic, says the increase over the past year largely reflects weaker demand rather than an influx of selling with new listings actually falling by 3.7% over the same period.

“The rise in total listing numbers isn’t due to a panicked surge in new listings,” he says. “This is more about less demand which is causing a rise in relisting’s along with longer selling times and fewer successful sales at auction.”

The flow of new listings is slowing but the stock of existing listings is increasing, in other words, reflecting that it’s now taking longer for the average property to sell.

So how long is it now taking for the average property to sell via private treaty?

According to latest data, it’s 53 days across the capital cities, up from 42 days a year ago.

CoreLogic

The lengthening in the average sales period is also reflected in total monthly sales volumes which continues to trend lower.

CoreLogic

While both largely reflect the impact of tighter lending standards towards interest-only and high debt and loan to income borrowers, as well as lower levels of foreign buyer activity and less desire to buy at a time when home prices are falling in many parts of the country, for those who are willing and able to purchase right now, Lawless says you’ll have plenty of negotiating power.

“More stock means more choice for buyers and harder selling condition for vendors — essentially a buyers’ market,” he says.

“Buyers have little sense of urgency under these conditions; they can negotiate hard, take their time to make a purchase decision, and if they feel a property price doesn’t reflect fair value, they can easily move onto the next property option.”

As for vendors, Lawless says price expectations may need to be reset.

“With so much competing stock on the market, vendors will need to be reasonable with their pricing expectations,” he says.

Given current nationwide auction clearance rates sit below 50%, it suggests the gulf between vendor and buyer expectations remain far apart in many instances at present.

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.