Aussie homebuyers want more space and bedrooms after COVID-19 confinement
Australian home buyers are looking for bigger houses on more land as the nation’s property boom continues.
According to the March report from the REA Insights Housing Market Indicators, there has been an increase in searches from buyers in the past 12 months looking for three-bedroom dwellings.
At the other end of the spectrum, there had been a decrease in buyers searching for one-bedroom dwellings, especially in city centres where the drop in demand was more noticeable than in regional centres.
The monthly report analyses consumer behaviour by looking at eight key metric indicators including search activity, email enquiry, views per listing, weekly sales of properties listed for sale on www.realestate.com.au, days on site of properties sold, filtered searches by price and by bedroom, and developer enquiry.
The report’s author, economist Anne Flaherty, says home buyers are buoyed by low rates, and are searching for more expensive properties than they were a year ago. “They are also looking for more space, with inquiries for houses and land surging, while demand for units has softened,” she says.
In March, inquiries for houses reached more than 63 per cent, while those for units was around 26 percent. Land inquiries had declined since their peak in June 2020 after the launch of the Federal Government’s HomeBuilder package, to around 10 per cent.
“In mid-2020 there was a surge in enquiry for vacant land as HomeBuilder was announced and that has continued throughout the year with vacant land enquiries recording the largest year-on-year increase despite it seeing a small overall share of total enquiry,” Ms Flaherty says.
More people were also testing the waters of the property market, with an unprecedented rise in the average views per listing up 106. 8 per cent year-on-year. Last month that figure rose another 6.1 per cent nationally. The biggest rise was in Tasmania, where there is a chronic shortage of stock.
“This growth can be attributed to several factors, including record low borrowing costs, government support packages for first-home buyers and limited available stock,” Ms Flaherty says. “Listings are expected to pick up over the remainder of the year, which should help to alleviate supply constraints and may contribute to a decline in views per listing over time.”
Stock that is available is not staying on the market for long, according to the report, with the average number of days listed on www.realestate.com.au down from 71 days in June 2020 to just 48 days last month. Properties in the ACT were selling the fastest with the average listing being only 25 days.
Buyers aren’t shying away from higher prices, with the report showing that Australians are now searching for fewer low-priced properties and more with a list price above $1 million.
In fact, there has been a four per cent jump in the number of searches for houses over the $1 million mark in capital cities according to the report, while a drop of three per cent was recorded for houses under $500,000.
|February 2020||February 2021|
Source: REA Insights Housing Market Indicators
With a shortage of stock in most states and territories, the report indicates that sales volumes have also increased dramatically in 2021 and are a third higher over the first 11 weeks of this year compared to the same time period last year.
“There has been 33.2 per cent more sales than there were over the first 11 weeks of last year and in most states sales volumes are more than 30 per cent higher than they were a year ago,” Flaherty says.
“With borrowing costs at historic lows, we would expect that transaction activity will remain strong over the coming weeks, the biggest challenge for the market remains the low volume of stock available for sale. However, new supply does seem to be increasing over recent weeks.”
Lawyer, Asset Protection Specialist and Property Educator
Dominique Grubisa is a practicing legal practitioner with over 25 years of legal and commercial experience. She is a property investor and developer, an entrepreneur with businesses in Australia and Southeast Asia, a speaker, educator, writer and published author. You may contact Dominique at firstname.lastname@example.org
This column has been written for general information purposes only. It is not intended as legal, financial or investment advice and should not be construed or relied on as such.