Property supply catching up with demand
Australia’s property market has remained tilted in favour of sellers for the 10th straight quarter – but the balance is shifting.
LJ Hooker reported that its buyer/seller index pointed towards sellers in the December 2014 quarter, as it has since the September 2012 quarter.
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However, the balance shifted towards buyers, with an eight per cent increase in sales surpassed by a 13 per cent jump in listings.
Despite the strong growth in listings, supply still hasn’t caught up with demand, according to LJ Hooker.
The state-by-state breakdown gives a more nuanced view of the property market.
Residents of NSW, Victoria, Queensland, South Australia and the Northern Territory are living in a seller's market.
Western Australia and the ACT are a buyer's market, while Tasmania is in balance.
LJ Hooker’s analysis of property and mortgage statistics suggests the market should move closer to balance in the next quarter – although an interest rate cut might change things.
“If the Reserve Bank of Australia cuts rates, as most economists forecast, buyer demand will lift and the LJ Hooker buyer/seller index will move back strongly in favour of sellers,” it said.
“Stability of interest rates will see demand remain consistent and slowly see the index swing back towards a balanced market as new listings rise and lower economic growth impacts demand.”
