The spring selling season is upon Australia’s housing market now, ringing true to the age-old saying this time of year is the best time to jump into real estate.
But a desperate rush of first home buyer scheme recipients and the effect of interest rate cuts is set to fuel competition and drive up prices.
According to data from Cotality, sales volumes differ significantly from season to season across Australia — but especially in two states.
NSW saw a 9.4 per cent increase in property sales during spring in the past 15 years, and Queensland had a 7.8 per cent rise.
The national property market experienced a 6.7 per cent sales increase overall in spring in the past 15 years.
It is a stark difference to summer real estate.
Australian properties saw an 11.5 per cent decrease in sales in summer, and NSW sales dropped by 16.2 per cent in the same period.
As for how new listings differ from average each season, prospective buyers observed a 14.4 per cent increase in spring nationally.
In NSW, it stands at a 16.8 per cent increase in new property listings, with 17.3 per cent in Victoria and 24.9 per cent in the ACT.
“Because cities in the south and south-east have cooler winters, spring time is especially useful for showcasing outdoor areas, pools and gardens in full bloom,” head of research at Cotality Eliza Owen said.
“This may be slightly less relevant in warmer states like Queensland, but even here seasonality in sales and listings is evident.”
This time of year itself is not the only reason why buyer demand is booming though.
Across the past 15 years, NSW saw a 16.8 per cent increase in new property listings in spring. (ABC News: Ian Cutmore)
The ‘double-edged sword’ this season
Sydney-based mortgage broker Gavin Dingley said the spring selling season has “a lot of emotion involved in it”.
“Every year there’s a massive property surge onto the market in spring across the country, and a rise in applications for home loans too,” he said.
“Families want to get into a new place before the end of the year, and essentially nothing happens in January in Australia for real estate.”
Right now, the impact of interest rates cuts is palpable too.
Gavin Dingley, a Sydney-based mortgage broker, reflected on the spring selling season. (ABC News: Abbey Haberecht)
Mr Dingley pointed to data from economist Andrew Wilson that listed 1,334 auctions in Sydney during one week in October — compared to 996 auctions during the same time period last year.
“We’ve had three rate drops in recent times. When you look at the number of auctions between this year and last in October, it’s clear interest rates have played a vital role in buyer demand,” he said.
“The lower the interest rates, the more people can afford to pay.”
Plus, the aftermath of the federal government’s 5 per cent deposit scheme from early October will likely see an increase in buyers, mainly for small properties or apartments.
“It’s a double-edged sword,” Mr Dingley said.
“It increases the number of buyers in the market, which increases demand for property — but the net effect is that with demand going up, supply might be technically limited and push prices up this season.”
For sale signs Sydney properties (ABC News: Fletcher Yeung)
What real estate agents see in spring
Sales agent Aaron Lih has eight years of experience selling in Western Sydney.
McGrath agent Aaron Lih says the Parramatta market in spring sees an interesting distinction. (Supplied: McGrath)
He said Parramatta experiences an interesting trend over spring — namely a boom in listings, but less buyers.
“It’s always been busier, but more so out here the market is full of sellers — there’s always a lot of stock,” he said.
“During this time it can then be a bit slower to sell it sometimes, because the stock levels are at its highest and the buyer demand isn’t quite there.”
For clients wishing to sell in spring in Parramatta, Mr Lih said he often encouraged them to try and beat the rush.
“Buyers hit the spring market a lot earlier compared to sellers. If you get it just that month before or a couple of weeks before, you’ll take advantage of the hot spring buyers.”
Adette Cao is an agent in Sydney’s Lindfield.
Sydney real estate agent Adette Cao. (Supplied: Stone Real Estate Lindfield)
She said this season’s real estate climate is proving a win for sellers in the upper north shore, with lots of interested buyers.
“For example, a listing I had in Normanhurst was for a typical young family — one level, multiple bedrooms — and that sort of listing has gone gangbusters.
“We also just sold a two-bedroom, two-bathroom apartment in Hornsby in the first home buyers demographic and that went after one inspection.”
Compared to previous years with higher rates, Ms Cao said buyers are now taking advantage of the benefits.
“It’s a great time to buy — especially for those who want to settle into their homes before Christmas.”