REA Group has released the REA Insights Listings Report for August 2021, which has revealed the dramatic impact lockdown has had on property supply for sale in Sydney.
New listings fell by 27.3 per cent over July 2021, the largest drop recorded since national lockdowns commenced in April 2020.
However, the report – which analyses new and active listings on realestate.com.au to provide a view on property market supply trends – noted that the fact that one-on-one real estate inspections have been permitted to continue in NSW seems to have had a significant impact on market confidence.
While new listings fell by over 27 per cent in July as lockdown began in Sydney, new listings in Melbourne declined by 75.3 per cent in August 2020 when it was in lockdown and inspections were prohibited.
Nationally, new listings fell 10.4 per cent in July, with the report attributing this to home owners opting to delay listing their properties for sale amid ongoing COVID-19 lockdowns.
On the other hand, demand for properties have remained near record-high levels, driven by low interest rates and healthy bank liquidity, the report said.
Demand has continued to significantly outstrip stock supply available for sale, with the REA Insights report stating that based on the market behaviour following previous lockdowns, REA Group is expecting that once current lockdowns end, there should be a fairly quick rebound in the volume of new listings coming to market to meet the strong demand.
Search activity on realestate.com.au increased by 19 per cent during the previous week.
The latest report also showed that Melbourne’s lockdown in July had an adverse effect on new listings, which fell 14.2 per cent, and 12.6 per cent in regional Victoria.
New listings in Brisbane fell by 6.6 per cent in July but only by 0.5 per cent in regional Queensland.
New listings in Adelaide fell by 26.9 per cent in July when the capital city was in lockdown, while they fell by 14.4 per cent in regional South Australia.
There was a 3.5 per cent decline in new listings in Perth and a 1.2 per cent fall in regional Western Australia.
New listings declined by 20.5 per cent in Darwin in July, and 18.7 per cent in regional Northern Territory.
On the other hand, Hobart was one of the few capital cities in which new listings increased in July (up 0.3 per cent), while regional Tasmania recorded a substantial 12.5 per cent rise.
New listings also surged in Canberra, up by 23.3 per cent in July, marking the largest monthly rise since February.
Commenting on the property supply-demand imbalance, REA Group director economic research Cameron Kusher said: “This lopsided market dynamic is creating an opportunity for vendors who choose to sell to be able to do so both quickly and at top-end prices. While this is good news for sellers, unfortunately for buyers, there is limited choice and fierce competition.
“As anticipated, the latest wave of lockdowns had an immediate impact on vendor confidence. What we saw in Melbourne last year was once restrictions lifted, new listings rebounded rapidly, rising to be 46.2 per cent higher in October 2020 than they were pre-lockdown.”
Mr Kusher also observed that properties for sale that were on the market for a long period of time are now being purchased, as new supply has failed to meet market demand, and “buyers start to reconsider properties they perhaps once passed over”.
“This trend is especially true in regional markets where there are now fewer properties for sale than in capital cities and supply is at historic low levels,” Mr Kusher said.
Malavika Santhebennur is the features editor on the mortgages titles at Momentum Media.
Before joining the team in 2019, Malavika held roles with Money Management and Benchmark Media. She has been writing about financial services for the past six years.