“Traditional drivers; births, deaths, marriages, divorces, remain the main reasons for property turnover. Life goes on, people for various lifestyle reasons [need to sell],” he said.
Carol and Grant Farrar sell their 22-year-old family home in Bundoorahope to get a better price by selling as soon as possible and hope to buy a townhouse or a smaller unit.
“We wanted to sell now while the market is still hot – it was much better in February and March, but we just weren’t ready to sell,” Ms Farrar said. “We didn’t want to sell with everyone in the spring because there will be a glut of homes for sale.
“Hopefully it will work in our favor to sell now and buy in a slightly cooler market in a few months.”
The Farrars are hopeful but also realistic about the price they will fetch, knowing that buyers will be hit by rising interest rates.
This week, ANZ predicted that the cash rate would continue to rise rapidly, hitting 3.35% in November in a bid to discourage consumer spending and help fight inflation.
For those with a $1 million home loan, that would add an additional $1,818 to mortgage payments each month, according to RateCity.
ANZ’s Australian economics chief David Plank said homeowners would be able to afford the higher refunds.
“People have jobs, wages are going up, and they have huge savings right now,” Plank said. “I don’t think we’ll see a lot of forced sales except for the usual reasons of job loss, illness or partnership breakdown.”
He said the biggest impact of interest rate hikes would be on the amount of money homebuyers could borrow and pay for a home.
This would make sellers likely to exit the market, with fewer listings. While this may moderate price drops, Melburnians were still likely to see an orderly decline in the market.
Village Real Estate managing director and auctioneer Huss Saad said anyone choosing to sell a renovated home now can expect good interest as the rising cost of undertaking a renovation hurts the market.
“I’m talking to people who were about to do a renovation, who have families and need extra space, and they’ve just received prices from the builders that are 30%, 40% or 50% above what they thought,” he said. “The remodeled homes that come to market are still doing well, but the repairers are tougher.”
Rayni Jerram of Ray White Bundoora, which is selling Carol and Grant Farrar’s home, said investors are also looking to unload their homes and shore up cash to upgrade.
“A lot of people offload their investments because they know the markets will only get poorer,” she said.
In Melbourne’s swankiest suburbs, Buxton Stonnington sales agent Harley Toyle said sellers were increasingly hesitant to sign up as interest rates rose, even though buyers wanted a lower number of registrations.
Even spring, which was normally busy, may be slower or increase in numbers later in the season, he said.
“I think people are naturally waiting to see what happens,” he said.
With Kate Burke
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