According to the latest statistics released by the Domain, the current discount rate for sellers of stand-alone houses in Sydney is close to 5.7% of (Vendor Discounting), the largest rate since April 2013. Only Darwin and Perth currently offer more than Sydney.
According to statistics, the average seller`s discount for Darwin`s stand-alone homes is 10.8% at this stage, compared with 7.9% at Perth. In addition, Sydney flat transaction price and listing price gap has widened, but the gap is not as obvious as stand-alone housing.
At present, the average discount (Vendor Discounting) for Sydney flat sellers is 5%, while the rates for other capital urban units are Melbourne (6%), Brisbane (6.9%) and Adelaide (6.4%). Hobart (6.8%), Perth (9.7%) and Darwin (16.8%).
Nicholas Powell, an analyst at Domain, said discount rates in Sydney were rising, so future sellers must be more realistic in terms of price. "the heat in the housing markets in Sydney and Melbourne is cooling, and about 40 percent of current buyers in Sydney are subject to regulatory restrictions," he said.
SQM Research also revised its forecast for this year`s Sydney housing market this week, forecasting prices to fall 4 percent or at most remain unchanged in 2018. In October, the agency had forecast growth of between 4% and 8% this year.
At the same time, new state property sales are also increasing, with the average sales time for Sydney`s independent homes at 66 days, the highest level since September 2013, when the number was 67 days. "as buyers choose more and more on the market, it gives them a longer time to make a final decision."
Domain also said Sydney has more unsold homes than it did a year ago. According to statistics, the total number of independent houses listed in March this year was 26356, compared with 23409 in March last year. The number of units for sale rose from 12472 a year ago to 14324. Melbourne, however, was different from Sydney, with a total of 32582 separate homes listed in the state capital in March, down from 36294 in the same period last year.
Credit tightening is the main cause
"as the housing markets in Sydney and Melbourne are dominated by investors, it is not surprising that the housing markets in Sydney and Melbourne will be the first in the event of tighter investment credit," said Tim Lawless, chief economist at Corelogic.
Credit tightening has led to a marked slowdown in investment activity, which in turn has a negative impact on the property market. In the 12 months to March 2018, Australian investment credit grew at an annualized rate of just 2.5%.
It is worth noting, however, that the impact of the decline in investment credit was partly offset by a surge in the number of first-time buyers in Sydney and Melbourne. According to statistics, in the 12 months to April 2018, Australia`s housing credit growth rate rose to 8.1 percent annually, the highest level since the second half of 2016.
Looking ahead, the, Tim Lawless believes banks are unlikely to relax existing lending restrictions, or even tighten credit conditions further, as a result of a Royal Australian Commission survey. As a result, the possibility of a soft landing of Australian house prices in the future is still very high.
