19th June 2020: Rise in New Listings Across Melbourne Points to Market Improvement

Brought to you by Domain - Melissa Heagney

Rise in new listings across Melbourne points to market improvement

Home owners in Melbourne's outer suburbs are proving more willing to list their properties for sale as the city slowly emerges from lockdown, with inner-city dwellers still hesitant to take the plunge.

While new listings are rising across the city as coronavirus-related restrictions ease, buyer interest has also been picking up, pointing to a slow improvement in the market.

Even so, many vendors are still reluctant to sell their homes amid the economic uncertainty and fears of possible house price falls, agents say.

In Melbourne's inner city, listings have lifted by just 1 per cent over the four weeks to June 14, compared with the previous four weeks, Domain figures show.

Glenn Bartlett of Woodards Carlton North said demand was outstripping supply when it came to the local market. First-home buyers were looking to buy into older apartment blocks, while upsizers were looking for traditional period homes.

Strong demand was keeping prices in the inner city steady, with an "imperceptible" change in prices, he said.

"That said, the market is still price sensitive. If a property is priced 5 per cent over where it should be, it will struggle to sell," he said.

The recent sale of an apartment at 8/376 Albert Street, Brunswick saw more than 100 people inspect it. The property sold for $505,000, more than $50,000 over the reserve.

Kay & Burton South Yarra director Michael Armstrong said while inner-city vendors had been keen to sell off-market, allowing them to test the waters during the worst of the coronavirus lockdown, that was now changing.

"Off-market listings have become almost too difficult for a lot of buyers because of the lack of transparency," Mr Armstrong said. Buyers could be unsure if a property was actually for sale.

He had seen listings gradually lift but this wasn't due to owners being in distress.

"I think if that was going to happen, we'd be seeing it right now," Mr Armstrong said.

In the middle ring in Melbourne's east, formerly "gun shy" vendors are now looking to get an appraisal to sell with numbers expected to continue to improve, Fletchers Canterbury director and auctioneer Tim Heavyside said.

In the Whitehorse area, which includes Box Hill, new listings have risen by 11 per cent over the month to June 14.

"Vendors and buyers are just feeling a little more comfortable now," Mr Heavyside said. "But there's still more buyers than sellers."

Like the inner city, prices were remaining steady, with popular properties reaching above reserve as more buyers competed during sales.

A recent auction at 17 David Street, Box Hill South saw the property sell for $1.239 million, above the $1 million reserve after five bidders fought it out for the keys at the auction.

Residents of Melbourne's outer suburbs were much more willing to tip their homes on the market.

In the north-west, listings are up 58 per cent over the month to June 14, but down 21 per cent since the same time last year.

Barry Plant Melton director Ned Nikolic said more competition from buyers was also seeing prices remain steady – equal to what they were in December last year as property prices continued to improve after the recent downturn.

House and land and established homes were both selling well as incentives, such as the federal government's HomeBuilder grant scheme, and low interest rates kept buyers in the market.

"It seems like vendors are waiting for things to clear up before listing," Mr Nikolic said.

In the south-east, which includes the first-home buyer stronghold of Cranbourne, new listings are up by 42 per cent over the past month.

First National Finning's Rick Lauretta said things were "heading in the right direction" with new listings back to 70 per cent of what they were prior to the coronavirus pandemic.

"There's definitely more inquiries from buyers," Mr Lauretta said.

Townhouses priced up to $450,000 were proving to be very popular, along with older established homes.

"Around September that will really be the test of the market with the incentives stopping and the spring market beginning."

Domain economist Trent Wiltshire said figures showed new listings had improved for the past few weeks.

"It's a big pick-up to where it was in March and April," Mr Wiltshire said. "But it's still 30 per cent down on where we were in February."

New listings ni Melbourne

Source: Domain. Figures are new listings between May 17 and June 14, 2020.

While recent figures were up year-on-year, they were being compared to new listing numbers when Melbourne's property market was bottoming out last year.

The market endured an 18-month downturn after banks tightened lending criteria in the wake of the financial services royal commission and vendors and buyers awaited the outcome of the federal election.

Since then, the amount of homes for sale has jumped in neighbourhoods across the city, with the eastern region up 58 per cent while the inner east, Boroondara, Whitehorse, Knox and Maroondah all jumped by at least a quarter.

Mr Wiltshire said the rise in new listings was a good sign, showing some improvements to the market.

"It looks like price falls will be a lot smaller than initially feared," he said.