Almost 15 per cent of listings on the Sydney property market were reduced in price during July as vendors struggled to sell, according to a report from Domain.
These figures have been reflected nationwide, with the larger capitals being much harder hit than smaller cities and regional areas.
Sydney’s 14.7 per cent is down from a June high of 15.2 per cent, but still sitting roughly three times higher than last year’s figures.
In Melbourne, 11.5 per cent of properties were discounted in July, four times the rate of July last year.
Dr Nicola Powell, Senior Research Analyst for Domain, anticipates a further “rapid rise of discounting rates in Melbourne” noting the heightened “demand shock” for the city, considering the COVID-19 crisis, among other factors.
“More vendors are discounting compared to last year but the second lockdown drove the opposite reaction to the first, with discounting rates sliding over the month,” Dr Powell explains.
“Melbourne entered stricter Stage 4 lockdown in early August, as the market adjusts to transacting entirely online, transactional activity is likely to pull back. This could drive some vendors to drop asking prices, particularly if they are in a position of needing to sell.”
Elsewhere, Adelaide saw 10.1 per cent of properties discounted, while Brisbane, Hobart, Darwin and Perth seem to be on a path to recovery, suffering earlier peaks in adjusting asking prices.
Outside of the cities, things are calmer still.
“Many resource-dependent regions are starting to see a revival,” Dr Powell says.
“Some mining towns are beginning to show a strong recovery with increased iron ore production, and strong prices being achieved for iron ore and gold, benefiting the resources sector and helping to expand the employment base in some areas.
“With all cities (apart from Canberra) below their respective peaks, it does suggest that vendors are listing homes with realistic price expectation to meet the market.
“Although the level of discounting is elevated, suggesting that prices continue to moderate each month as vendors adjust to meet market expectation, price falls will continue in the months ahead.”
|Proportion of sale listings with a discount|