“You have buyers who want to buy and sellers who want to sell, but what we had before was buyers who wanted to buy and hardly anyone who wanted to sell.
“A normal real estate market is one where a buyer and a seller have a chance to negotiate a position, whereas the market we had, only the seller had a chance.”
He said an auction clearance rate of between 55 and 65 per cent is a normal market, which does not mean a property is not selling, only that it may be a week or more after. the auction to reach an agreement.
Sydney and Melbourne auction clearance rates hovered around the 60% mark in May. Analysts correlate a 70% auction resolution rate with annual home price growth of around 10%, but consider 60% to be a balanced market.
In Melbourne, Barry Plant chief executive Mike McCarthy agreed the city was heading towards a normal market, adding that the inner and mid-range suburbs were already there while some outer suburbs were still at the end of a market. strong.
In terms of days on market, it would normally take around 30 days for a home to sell, but in strong markets properties snap up faster.
He said buyers were looking but not pushing as hard, citing auction results he had seen in his neighborhood.
“I’ve seen a lot of passersby, but at the end of the day you see a sold sign on it, or you see a sold sign on Monday or Tuesday,” he said.
“It’s classic to come back to equilibrium – a little more equilibrium at auction.”
He said buyers adapt quickly once they see other properties go by, and may not bid as highly, meaning sellers have to look at very recent results to figure out where their home is instead. than relying on sales near the end of last year that may no longer be achievable.
The estate agency’s managing director, Matt Lahood, said a normal real estate market is one where there is one buyer for every seller, rather than many buyers willing to outdo each other to win competition for a property.
“This thing about 10 people signing up and the first offer hitting the reserve that we had seen, we all knew was unusual,” he said.
“People could potentially be reassessed on their purchasing power as interest rates continue to rise. They could have a loan request for $1 million today [and] in other [period of time] that million dollars becomes $900,000.
He said the Sydney and Melbourne property markets had returned but there were still slightly more buyers than sellers now, although a clearer picture could emerge over the winter.
“Sellers need to know that if interest rates continue to rise, their buyers…simply won’t have the same buying power.” Lahood added that, on the other hand, buyers who don’t buy now could face reduced borrowing capacity.
Wakelin Property Advisory director Jarrod McCabe said a normal market can also mean a market where sellers are able to open their homes for inspection for a month without the interruptions of closings over the past two years.
Instead, home sellers are thinking about seasonal features such as selling bayside property during the warmer months, he said.
He added that an increase in the number of homes being put up for sale, with several auction weekends this fall above 1,000 bids for Melbourne, had helped the market balance out and reduced buyers’ fear of moving on. to the side.
“From a supplier’s perspective, you have to be attractive in the market,” he said.
“From a buyer’s perspective, I’ve seen a lot of auctions this year where there have always been good levels of competition and high prices, usually better properties that don’t have significant trade-offs. you should always expect to have to compete for it.
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