Market Slowdown and Vendors Strategies; Short-term vs. Long-term
Following plunging figures from last May and April’s Sydney property market, the June statistics emphasised that buyers have lost their appetite to match vendors’ price expectations and the market is aggressively approaching a genuine turning point or slowdown period. Despite this, there is still strong belief that such slowdown is not sustainable in the long run for Sydney and that the market will pick up sooner or later.
Last June recorded the second lowest auction clearance rate in the current year, with a below 70% auction clearance rate across the state for consecutive weeks. Consumer Sentiment Index and Time to buy a Dwelling Index also indicate that buyers are becoming more pessimistic and reluctant to rush into buying property. The vendor’s market is anticipated to be even more negatively impacted in the coming Spring with an increase in the number of listings which will give already diminishing buyers crowd more choices.
While the market highlights the start of a slowdown period, property market analysts seem to be hesitant to call it a long-lived trend. They believe that the property demand and supply equation for the Sydney property market has been historically so biased towards demand, especially in comparison to other cities like Melbourne and Brisbane, that any hope for long term price moderation in Sydney is rendered irrational and unrealistic.
With all these facts in mind, the fair position for short term vendors may be to get their property into the market earlier while vendors with long term plan may be better off to wait for another couple of years until the market picks up again as anticipated.