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Australia - More vendors tried to sell their property in spring – but did people buy them?

As social distancing restrictions eased across Victoria from the end of September, more vendors put their property up for sale.

In the three months to November, the number of new listings added to the market across Australia averaged around 39,000 a month. This was 20.8% higher than in the winter months. Although winter usually sees less listings due to seasonality anyway, strict restrictions and subdued economic conditions across Melbourne in particular had weighed on transaction activity over winter.

As more new stock was added to the market in the months following, it is worth considering how much demand for property absorbed this rising supply. If rising stock is met with low levels of demand, property listings accumulate, giving buyers more choice and bargaining power. This could be a concern for sellers, some of whom may have no choice to sell if their ability to repay their mortgage has been impacted by COVID-19.

This was considered a risk to property markets more broadly with many exiting mortgage deferral arrangements through September and October this year.

CoreLogic tracks the volume of sales compared with new listings added to the market₁, in order to partially understand the state of supply and demand – in other words, are people actually buying property at the same rate as new stock is being added?

This metric, known as the ‘sales to new listings ratio’, represents the number of residential property sales for every additional dwelling advertised in the same period. A sales to new listings ratio above 1 suggests there is more than one sale for every new listing, indicating a seller’s market. A sales to new listings ratio below 1 suggests that there is less than one sale for every property added, and buyers have more bargaining power.

The latest months of sales volumes from CoreLogic are modelled estimates, and are subject to revision over time.

The sales to new listings ratio is discounted for the month of December, due to strong seasonal effects.

How is the sales to new listings ratio holding up around different capital city markets?


In November, the sales to new listings ratio was 1.3 across greater Sydney, suggesting there had been 1.3 sales in the month for every new listing added to the market.

The relatively strong result through November was the result of an estimated 3.7% increase in sales volumes over the month, as listings fell -11.3%.

This indicates rising demand for property across the Sydney housing market, where values increased 0.4% in the same month.


Melbourne currently has the weakest sales to new listings ratio, averaging just 0.6 in the three months to November.

Modelled sales volume estimates suggest property sales declined – 14.9% in Melbourne over the month of November, as new listings surged to unusually high levels when the city came out of lockdown.

The sales to new listings ratio suggests there is more stock available for buyers across Melbourne, and is reflected in a slight weakening in median days on market from 30 in October, to 32 in November.

While the numbers seem weak, the Melbourne property market still saw an increase in dwelling values overall of 0.7% in the month of November.

This may be explained by record-low costs of mortgage debt, which has increased purchasing power, as well as the fact that the surge in new listings may be concentrated to particular areas of Melbourne which are seeing relatively low demand.

An example of this is the Melbourne – Inner region, which had the highest level of stock on market over November, with 4,652 dwellings listed for sale in total.

This is a market traditionally popular with investors, which may be seeing low absorption due to the decline in investor participation in the housing market.

The latest ABS housing finance data suggests the share of mortgage finance for property purchases lent to investors was down to 23.4% in the month.

Ultimately, buyer demand has not matched the increase in listings in recent months, and this may dampen the recovery of the Melbourne housing market.


In November, the Brisbane property market saw a sales to new listings ratio of 1.1.

Sales volumes across Brisbane were fairly steady over spring, averaging an estimated 4,174 per month in the 3 months to November.

New listings added to the market were slightly lower with an average of 4,072 per month in the same period.

This suggests demand is relatively strong across the market relative to new listings added, exemplified by consistent value increases across the city over the past 3 months.


Adelaide has generally seen a strong level of sales volumes matching new listings added to the market over 2020.

However, an estimated drop in sales volumes over the month suppressed the ratio in November.

Transaction activity may have been shaken by the COVID-19 cluster discovered in mid-November, which triggered a short, sharp lockdown across the state.

While Adelaide restrictions were quickly eased, auction data shows the city delivered an unusually low clearance rate of 48.9% in the week it was imposed.

Over the three months to November, the sales to new listings ratio averaged 1.2, which was one of the higher results of the capital cities, reflecting strong demand across the smaller capital city markets.


In the three months to November, the ratio averaged 0.9.

However, the demand for property relative to stock added to the market was still higher than in than the equivalent period of 2019, averaging 0.7.


The Hobart dwelling market has gone from strength to strength in the past few years, and the spring of 2020 was no exception.

Buyer demand remained high in the three months to November, with the ratio averaging 1.2.

This coincided with a 2.9% increase in dwelling values over the same period.


As well as having the highest capital growth rate between March and November, Darwin dwellings had the highest sales to new listings ratio in November of the capital cities, at 1.4.

Over the spring selling season, the ratio averaged 1.7.

This is reflective of the start of a rebound across the Darwin market, where dwelling values had seen a long, large correction off the back of the end of the mining boom.

While this market seems to be following a recovery trend, values are still -27.4% below the record high in May 2014.


Across Canberra, the sales to new listings ratio was 1.3.

As with Darwin, the Canberra dwelling market has seen relatively strong performance over 2020, despite the onset of COVID-19.

Values have risen 5.2% between March and November.

The Bottom Line

The increase in the ratio over November coincided with an estimated 16.1% sales volume increase over the month, as new stock added to the market tightened.

Overall, the sales to new listings ratios indicate that an increase in listings activity over the spring period was met with high demand, despite Australians being in the wake of technical recession.

Record low mortgage rates and a rebound in consumer sentiment has likely had a lot to do with this.

But the numbers also highlights the relative fragility of the Melbourne market, where stock is accumulating across the inner city.

Demand for these properties may slowly increase as international travel arrangements rise over 2021, where this market has traditionally seen high levels of housing demand from overseas migration, and international students.

Until then, a rebound in this dwelling market may be subdued, particularly within the inner Melbourne unit market.

Author: Eliza Owen


New York Office
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