The REA Insights Listings Report July 2021 has revealed that there were 19.7 per cent fewer active listings in June 2021 compared to June 2020, representing the largest year-on-year decline on record.
This was driven by a 30.6 per cent year-on-year decline in regional areas, and a 6.9 per cent decline in the capital cities.
This has demonstrated the substantial increase in demand, and subsequently sales, of properties in the last 12 months, according to the report, which analyses new and active listings on realestate.com.au to provide an updated view on property market supply and demand trends.
There was a more noticeable reduction in stock for sale in regional areas in the past 12 months than in capital cities. There were more properties available for sale in capital cities than in regional markets compared to the same time last year.
The research found that month-on-month active listings declined by 3.3 per cent nationally in June 2021, with listing levels reaching a new historic low in regional areas (down 2.6 per cent month-on-month).
The REA Group attributed this to buyers embracing buying properties outside of capital cities.
National new listings fell for the third consecutive month in June 2021 by 5.5 per cent, but new listings were up 19.4 per cent year-on-year.
Lockdowns limit listings in NSW, Victoria
The number of new listings in NSW and Victoria has likely been adversely affected by lockdowns, with Sydney and Melbourne, and regional NSW and Victoria recording their lowest new listings levels since January 2021.
As Sydney begins its fourth week of lockdown due to the latest COVID-19 outbreak of the Delta variant, new listings plummeted by 13.3 per cent month-on-month in June 2021 but rose by 23.7 per cent year-on-year, while active listings dropped by 4.7 per cent month-on-month and 2.4 per cent year-on-year.
New listings in Melbourne (which is facing another snap lockdown for five days) plunged by 11.1 per cent month-on-month but rose by 17.3 per cent year-on-year. Active listings declined by 7.1 per cent month-on-month, and by 0.8 per cent year-on-year.
Most capital cities recorded a fall in new listings in June but Darwin bucked this trend and reached its highest new listings volumes since May 2016 (with a 162.3 per cent year-on-year growth and an 11.1 per cent month-on-month increase).
New listings in regional Northern Territory are at the highest they have been since May 2017 (up 71.7 per cent year-on-year).
Hobart is the only capital city where active listings are at a historic low (down 34.3 per cent year-on-year and 10.4 per cent month-on-month), while Brisbane (up 1.3 per cent) and Darwin (up 9.3 per cent) were the only capital cities where active listings increased over the month.
Competition to drive up prices
Commenting on the research findings, REA Group director economic research Cameron Kusher observed that the fall in active listings in June has underscored the overall shortage of properties for sale, with insufficient new listings being added to meet demand.
“Properties for sale that were sitting on the market have now been bought as new supply in June failed to meet demand,” he said.
“It is reasonable to expect competition for properties for sale will remain strong pushing prices higher in markets where activity remains heightened despite the seasonal slowing.”
Meanwhile, there was a 3.7 per cent rise in newly listed properties for rent in June 2021, but this was insufficient to meet demand, with active listings falling by 2.4 per cent over the same period.
“Intense competition in regional markets due to shifting populations is the primary driver of record low active rental listings,” Mr Kusher said.
“However, there are two very different rental markets playing out. Outside of challenged inner-city Sydney and Melbourne unit markets, the strong demand for rental accommodation is expected to see the cost of renting continue to climb.”
[Related: Detached housing starts jumps 40% YOY: ABS]
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.