The spring selling season typically sees a lift in listings activity, with more properties available for sale and subsequently an increase in auction activity. This is especially the case as the spring season usually follows a bleak winter sales period.
Last year spring was a bit of a disappointment, with sales volumes across the combined capital cities -3% lower than they were in the spring of 2010 and recording no noticeable improvement from volumes in autumn. The amount of stock available for sale was continually increasing throughout the period to historic high levels and home values were falling across each capital city market.
Although economic conditions are not as strong as they were before the financial crisis, generally most indicators are stronger currently than they were at the same time last year.
In stating this, it is also important to analyse how the economy is tracking compared to a longer term average (10 years) to get a better understanding of the overall state of the economy, compared to what might be considered ‘normal’ based on the decade average.
The table highlights a number of economic and housing market measures currently, together with a comparison with the same measures one year ago and a longer term average. In terms of a comparison of conditions at the same time last year, the overall economic state is generally more positive.
Looking at the table (below) it is clear that many housing market indicators have moved off their low base over the year. There have been some positive movements for home values, new stock being added to the market is lower and each of the vendor metrics (selling time, vendor discounting and auction clearance rates) have all shown an improvement.
Economic data also supports the stronger conditions with consumer sentiment stronger, an increase in housing finance commitments, lower standard variable mortgage rates, a greater rate of population growth and an improvement in retail trade.
It is important to note that, although the results are largely stronger than last year, some of the items that are weaker than at the same time last year are likely to have a fairly significant impact on the market’s performance.