Throughout Covid we saw a steady increase of property values driven by low stock, low interest rates and a shift in peoples needs from there home. We had a two tier market with apartments pulling back and the housing market booming. Covid made people want more space as they spent more time at home. There was simply not enough stock to keep up with demand hence a strong increase in that segement of the market.
We are now seeing low stock levels throughout Melbourne, as housing conditions slow, we are seeing the market swinging back to a more even market. Advertised stock levels remain -7.4% lower relative to 2021, in Melbourne. Estimated transactions in Melbourne is down -18.3%. At the same time, the flow of new listings added to the market is falling as vendors become nervous about conditions for selling property and we move into the seasonal winter lull.
We aren’t seeing any signs of panicked selling as housing conditions cool though, in fact the trend is the opposite, with the flow of new listings to the market slowing. I think most vendors knew that interest rates were at a historically low level and calculated a conservative buffer into their lending capacity.
We are seeing more properties transact off market. While we always purchase a large proportion of our properties off market we have found while searching for clients on market stock is significantly down with many areas only showing a few listings. In reality we are finding many vendors are not wanting to take their property to market through an advertised campaign due to uncertainty. This is giving buyers who have access to these off markets an undoubted advantage to purchase without competition.