A surge in housing stock sitting on the market for up to 60 days may indicate the beginning of the capital city market downturn due to the impact of Covid-19.
Australia's residential property listings increased by 3.7 per cent in March, from 296,770 listings in February to 307,847, according to SQM data.
SQM managing director Louis Christopher said the March result shows residential property listings are starting to accumulate.
“I note the surge of stock that has been on the market between 30 and 60 days, [m]ay reflect the start of a capital city housing market downturn due to the health and economic impact of Covid-19,” Christopher said.
“Listings that have been on the market for between 30 to 60 days surged by 74 per cent, suggesting sales activity did slow during March.”
Listings were up in all capital cities, with the largest increase in Darwin, at 15.6 per cent, followed by Canberra at 11 per cent and Sydney 10.5 per cent.
Hobart had the smallest increase of 2.4 per cent.
Stock on the market
|City||March 2020 total||Monthly change %||Yearly change %|
Source: SQM Research
Capital city asking prices increased by 0.7 per cent for houses and increased 0.6 per cent for units during March, with house asking prices now averaging $990,500 and units at $577,000.
"I also note though the rise in asking prices for the month, so quite a number of vendors have not really adjusted their pricing expectations as yet,” Christopher said.
Capital city asking prices posted increases of 8.8 per cent for houses and 2.1 per cent for units, a year ago.
Darwin and Hobart both recorded the highest increases for houses of 3.1 per cent, and the highest price increase in units was Sydney and Perth with 0.8 per cent increase.
Brisbane fared less well, with decreases in both house and unit prices – 0.1 per cent for houses and 0.5 per cent for units.
Canberra and Hobart posted declines in unit prices of 2.2 per cent and 3.5 per cent respectively but recorded house price increases of 0.4 per cent and 3.1 per cent respectively.
Adelaide posted declines in house prices of 0.9 per cent but unit prices were up by 0.3 per cent.
The results reveal further cracks in the housing market, after 45 per cent of house auctions were withdrawn on what should have been one of the busiest weekends of the year.
Homebuyers hoping for a drop in property prices due to knock-on effects from coronavirus could be disappointed, with CBRE's latest market update pointing out that Australian property has traditionally fared relatively well during global economic shocks.
Australian property prices were ultimately boosted by the 1987 Black Monday sharemarket crash, while house prices and sales volumes rebounded by 19 per cent in 2009 after the global financial crisis.