There are fewer houses being sold in capital cities in the past month and it seems to be a fluctuating trend. The housing sales for the past 3 months have decreased on the previous 3 months but what is more unexpected are the sudden drop within the month of November. In Sydney the decrease is numbered -1.0% for the previous 3 months whereas it has decreased further to -1.4% in the month of November. In Melbourne the shift has changed suddenly for November for the previous 3 months the decrease was -0.5% a moderate amount but has expanded to an very unexpected -3.5% over the month.
The interest rates increased by the major banks has also decreased the amount of money loaned to homebuyers and due to the APRA regulations (a slower than 10% a year speed limit) has caused growth to slow significantly in attempts to avoid riskier home lending and causing the influx of mortgage defaults which is very real concern. This is due to the amount of money people have to purchase or sell their homes and with the average amount of money in a house spent on a mortgage in Sydney is rated at over 39% and Melbourne over 32% it is understandable that people are becoming more and more wary of home buying.
There’s also the consideration of the term “spoiled for choice”. More people are selling houses than are buying them. Some houses that years passed would be described as “cosy” are now considered what they would seem to be which is small. Whereas “family homes” are now considered to be large houses bordering on mansions. There is so many of these family homes outside major cities but within easy distance of travel (say 30 minutes by car or 45 by public transport) that are the same cost as these cosy houses or units within a major city people have just started coming to the decision that the travel aspect is easier so they head for suburbs outside of the cities.