Interest rate levels more of a worry for buyers than sellers

PropTrack’s April Residential Audience Pulse Survey revealed that the number of respondents saying ‘now is a good time to buy’ was down 1 per cent compared to the same time last year, at 35 per cent.

This slight decrease in buyer confidence was contrasted by those believing that now was a good time to sell, which jumped significantly, by 24 per cent to a total of 41 per cent.

“Record low supply amid strong buyer demand has resulted in a sellers’ market,” said PropTrack’s senior economist Eleanor Creagh.

“The influx of new listings this year has been matched by robust demand fuelling further price increases. However, growth momentum has slowed since the beginning of 2024, with both monthly and quarterly growth easing in April.”

Interest rate worries were recognised as the key driver of uncertainty, with 62 per cent of surveyed respondents ‘very’ or ‘slightly’ concerned.

Interest rate hikes are also taking a toll on wellbeing, with mortgage stress becoming a key complication due to increased monthly loan repayments.

Despite the stress felt through interest rate levels, just one in four sellers noted that prices were high.

According to realestate.com.au, this is deterring buyers, as high prices plus high interest rates are compounding into a cocktail of uncertainty, compared to where the market sat a couple of years ago.

Western Australia recorded the most uncertainty, with those believing now was a good time to buy dropping by 11 per cent, to 21 per cent in April.

This is likely due to the significant rise in home value across the state, with values in Perth growing by 20.16 per cent in the past year. Comparatively, Sydney grew by 7.24 per cent, Melbourne by 1.1 per cent, and Brisbane by 12.82 per cent. The only city to record a drop in prices was Hobart, falling 1.98 per cent throughout the year.

However, according to Creagh, there may be light at the end of the tunnel: “While demand remains robust, the pace of price growth is beginning to slow … Most expect that the next move for interest rates will be down although the timing remains uncertain.”

Meanwhile, the national average increase was 6.6 per cent, putting Perth’s growth more than three times that figure, with reports of low stock only adding to the pressures.

However, there are those who were still interested in buying and there were a variety of reasons that motivated people to do so. The top of which were:

1. Lifestyle change

2. To make financial gains

3. Retirement

4. Upsizing

5. Downsizing

Compared to the beginning of the year, these results remained largely the same. However, there was a 41 per cent increase in buyers wanting to move to a different area.

[Related: ‘We might have to raise, we might not’: Bullock]