Queensland vendors prefer not to sell at all rather than sell at a deep discount
Queensland vendors appear intent on holding onto their properties rather than selling in suburbs where prices are currently declining, new research by PRDnationwide has revealed.
Of the 20 Queensland suburbs to record the greatest drop in house sales activity over the six months to June this year (compared with the same period last year), 18 experienced price falls of between 2% and 12%.
In comparison, among the 20 suburbs to register the greatest increase in sales activity over the six-month period, 14 of these registered median price increases over this time, with only three recording house price declines of 6% of more.
Suburbs to record sales activity drops of more than 50% included Urraween in Hervey Bay (sales numbers down 52%, prices down 2%), Bowen near the Whitsundays (sales numbers down 59%, prices down 1%) and Douglas in Townsville, where sales activity fell 55% following a price decline of 11%.
Sales activity picked up in mining suburbs such as Gracemere (37 additional sales, house prices up 3%), Calliope (26 additional sales, house prices up 11%) and Dysart (24 additional sales, prices up 15%), while some coastal towns like Tannum Sands (26 additional sales, prices up 7%) also received increasing activity as a result of the mines.
The suburbs that recorded the largest drops in sales activity but without the corresponding drop in sales prices were The Gap in inner Brisbane, which registered a 57% drop in annual sales despite house prices remaining unchanged over the six-month period, and the far north Queensland town of Atherton, where sales numbers fell 63% despite the median house price rising 5%, to record the biggest percentage decline in sales activity of all suburbs in Queensland.
Overall, for the June 2011 half-year period, Queensland recorded a total of 53,707 settled house transactions, equating to an annual softening of 22.8% (15,900 sales) from the previous year.
Source: PRDnationwide
According to PRDnationwide research director Aaron Maskrey, the significant softening in sales activity and values reflected a drop in first-home buyers, where demand was pulled forward in 2009 due to the boosted first-home owners grant and low interest rates and an investor segment “patiently waiting to see if they can attain a better bargain with values declining across most markets in the state”.
“Purchasers looking at property should consider that historically low sales activity, softening capital values and increasing rental yields, form an ideal market to buy a property primed for strong returns. These buyer favourable conditions also allow purchasers to exploit their position in the market place to acquire a property at a discounted price,” Maskrey says.
