Entering a new cycle

(Ray White Craigieburn agent and auctioneer Daniel Diamantopolous.)

ONE thing Ray White chief economist Nerida Conisbee can be certain about is that the property market is entering a new cycle.

May will be an interesting month, beginning with a 0.25 basis points rise in the official cash rate and ending with an election. All eyes were on the central bank yesterday to see how far they moved and now the big question will be what is the effect on the property market. Even the hint of a cash rate hike and the federal election announcement may have already seen some buyers and sellers approach the market with more caution. Many have claimed the expected rate rise changed their plans - whether they decided to hold off or pull the trigger early.On the weekend, a three bedroom home in Paddington, Sydney sold for $3 million through Ray White Woollahra | Paddington director Clay Brodie. Asked about the market, Mr Brodie said there was naturally some hesitancy right now with all the talk of rate rising imminent, “but quality properties in good areas are still selling well”.Meanwhile in Brisbane, Ray White Beenleigh principal Glenn Hamilton sold 178 Mount Warren Boulevard, Mount Warren Park for $482,500. Post auction, the Beenleigh agent said he’s noticed a shift with many buyers definitely wary of over-spending. He also said “talk of rate rises next week may have dampened the number of buyers who attended the auction”.This caution has also been reflected in the numbers. The Ray White Group finished the month with nine per cent fewer listing authorities (homes listed but not yet advertised) than this time last year.Ray White chief economist Nerida Conisbee said fewer homes for sale was good news overall.“It does mean that there are low levels of distress and it will prevent a large fall in house prices. But for buyers, it does mean it will be harder to take advantage of lower prices,” she said.“When markets enter a new cycle, there is typically less new listings coming to market as sellers are more cautious. This lack of new stock on the market creates a challenge for buyers to find quality property.

“For these reasons, in a slow market, highly desirable properties are well sought after and will often defy expectations.”

In the auction space, April's national bidder numbers were slightly down from the unprecedented highs of last April but were still historically up on earlier years. In April, the leading group recorded an average of 4.7 registered bidders per auction - down 1.3 on last year and 2.9 average active bidders - down 0.7 year-on-year.The month’s clearance rate dipped slightly but only by just over two per cent to come in at 73 per cent. Last April’s market was very different to this year but the clearance rate, like bidder numbers, was still historically high based on previous years. In April 2020, Ray White recorded a 40 per cent clearance rate and in pre-pandemic 2019 the rate was 46 per cent.

This week, the Ray White Group has 582 listings scheduled to go to auction nationally. On Saturday alone there are 332 auctions scheduled. Ray White in Melbourne has 135 auctions scheduled while Ray White Sydney has another 131 auctions booked in. Ray White Adelaide has 65 auctions scheduled while Brisbane has 59 auctions booked in this week.